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Inflation Calculator

See what something will cost in the future, and how much less your money will buy, at any inflation rate.

How it works

Inflation compounds like interest. The future cost is amount × (1 + rate)^years. To find what today's money will be worth, divide instead: amount ÷ (1 + rate)^years.

Worked example

At 3% inflation, something that costs $100 today will cost about $134.39 in 10 years. Put the other way, $100 kept in cash will buy only about $74.41 worth of today's goods, a 25.6% loss of buying power.

Typical inflation rates

Many central banks, including the US Federal Reserve, the European Central Bank and the Bank of England, aim for about 2% inflation a year. Long-run US inflation has averaged roughly 3% a year, but it has spiked above 8% in some years. Use 2% to 3% for long-term planning and a higher figure to test a worst case.

Protecting your money from inflation

• Cash in a low-interest account loses value when inflation is higher than the rate paid.
• Stocks, property and inflation-linked bonds such as US TIPS or I Bonds have historically kept up better over the long run.
• Ask for pay rises that at least match inflation, or your real income falls.

Frequently asked questions

What is inflation?

Inflation is the general rise in prices over time, which means each dollar buys a little less each year.

What inflation rate should I use?

2% to 3% is a common long-term assumption. For a recent period, use your country's official consumer price index (CPI) figures.

How does inflation affect savings?

If your savings earn less interest than the inflation rate, their real value shrinks even though the balance grows.

What is the rule of 70 for inflation?

Divide 70 by the inflation rate to estimate how many years it takes prices to double. At 3.5%, prices double in about 20 years.

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