Inflation Calculator
See how inflation changes the value of money over time. Enter an amount, the average annual inflation rate, and the number of years to find out how much the same things will cost and what your money will be worth in today's terms.
Equivalent cost in the future
1,343.92
Check the highlighted fields to see your result.
- Purchasing power
- 744.09
- Cumulative inflation
- 34.39%
Year-by-year breakdown
| Year | Equivalent cost | Purchasing power |
|---|---|---|
| 1 | 1,030.00 | 970.87 |
| 2 | 1,060.90 | 942.60 |
| 3 | 1,092.73 | 915.14 |
| 4 | 1,125.51 | 888.49 |
| 5 | 1,159.27 | 862.61 |
| 6 | 1,194.05 | 837.48 |
| 7 | 1,229.87 | 813.09 |
| 8 | 1,266.77 | 789.41 |
| 9 | 1,304.77 | 766.42 |
| 10 | 1,343.92 | 744.09 |
Results are estimates for information only and do not constitute financial, medical, or legal advice.
How inflation works
Inflation is the general rise in prices over time. When prices go up, the same amount of money buys fewer things: its purchasing power goes down. Like compound interest, inflation builds on itself, because each year's rise is applied to prices that have already gone up.
This calculator shows two sides of the same effect:
- Equivalent cost in the future: how much you'll need later to buy what costs your amount today.
- Purchasing power: how much your amount will be worth later, measured in today's money.
It assumes the same inflation rate every year. Real inflation changes from year to year, so use an average rate and treat the result as an estimate. A negative rate means deflation: prices go down.
The formulas
Future cost = P × (1 + i)t
Purchasing power = P ÷ (1 + i)t
- P: amount today
- i: annual inflation as a decimal (3% = 0.03)
- t: number of years
Cumulative inflation is (1 + i)t − 1, shown as a percentage.
Worked example
Something costs 100 today and inflation is 3% a year. What happens over 3 years?
- Year 1: 100.00 × 1.03 = 103.00
- Year 2: 103.00 × 1.03 = 106.09
- Year 3: 106.09 × 1.03 = 109.27
In 3 years the same thing will cost about 109.27, a cumulative rise of 9.27%. Seen the other way around, 100 in 3 years will buy what 91.51 buys today: 100 ÷ 1.033 = 100 ÷ 1.092727 = 91.51.
Frequently asked questions
Where can I find the inflation rate?
Each country's statistics office publishes the consumer price index (CPI), which measures inflation: for example the Bureau of Labor Statistics in the United States, the Office for National Statistics in the United Kingdom, and Eurostat in the European Union. To estimate the future, many people use their central bank's target, which is often around 2% a year.
What's the difference between annual and cumulative inflation?
Annual inflation is how much prices rise in one year. Cumulative inflation is the total rise over several years, and it is more than adding up the annual rates, because each year prices rise on top of the previous rise. With 3% a year, prices rise about 34.39% in 10 years, not 30%.
Can I use it for money from the past?
Yes. Enter the amount from back then, the average annual inflation since that year, and the number of years. The equivalent cost shows how much you would need today to buy the same things.
How do I know if my savings are beating inflation?
Compare the interest rate you earn with inflation. If your savings grow at 5% and inflation is 3%, your real return is about (1.05 ÷ 1.03) − 1 = 1.94% a year. If the interest rate is lower than inflation, you're losing purchasing power even though the balance goes up.
Does it work with very high inflation?
Yes, it accepts rates up to 10,000% a year. If you only know the monthly rate, convert it to an annual rate first: with 5% a month, the annual rate is (1.05)^12 − 1, which is about 79.59%.