Inflation Calculator
See how inflation changes the value of money over time and what a sum will be worth in future.
Content updated July 1, 2026
Inflation quietly erodes cash. $1,000 kept under the mattress for 20 years would buy only $554worth of today's goods.
Inflation means the same goods cost more over time, so a fixed amount of money buys less each year. This calculator shows two sides of that: what something costing a set amount today will cost in future, and how much today's money will actually be worth down the line.
It's a simple but eye-opening tool for planning — especially for long-term goals like retirement, where decades of even modest inflation dramatically change the numbers.
The Inflation formula
Future cost = Amount × (1 + rate)^years · Future buying power = Amount ÷ (1 + rate)^yearsAmount = the sum today · rate = annual inflation rate as a decimal · years = number of years. The first form shows what something will cost; the second shows what today's money will be worth.
Worked example
At 3% inflation, an item costing $1,000 today would cost 1,000 × (1 + 0.03)^10 ≈ $1,344 in ten years. Equivalently, $1,000 held as cash would buy only about $744 worth of today's goods after that decade.
Why inflation matters for savers
Cash sitting in a low-interest account loses real value when inflation outpaces the interest it earns. That's why keeping too much in cash over long periods quietly costs you buying power, and why many people invest for long-term goals instead.
The formula is future cost = amount × (1 + rate)^years, compounding each year just like interest — only working against you rather than for you.
Frequently asked questions
▶What inflation rate should I use?
Many economies target around 2–3% a year. For long-term planning, a rate in that range is a reasonable default, though actual inflation varies year to year.
▶How does inflation affect my savings?
If your savings earn less than the inflation rate, their real value falls over time. To preserve buying power, your return needs to at least match inflation.
▶What will my money be worth in the future with inflation?
Its buying power falls by roughly the inflation rate each year, compounding. To see the future purchasing power of a sum, divide it by (1 + rate) raised to the number of years.
▶How do I calculate the effect of inflation over several years?
Multiply the amount by (1 + rate)^years. At 3% inflation, something costing $100 today would cost about 100 × 1.03^10 = $134 in ten years.
▶What's the difference between nominal and real value?
Nominal value is the face amount in future dollars; real value adjusts for inflation to show what it can actually buy. Inflation calculators translate between the two.
▶How much does inflation erode cash over 20 years?
At 3% a year, prices roughly double over about 24 years, so cash left uninvested loses close to half its buying power over two decades. The exact figure depends on the rate you assume.
Related calculators
See how a lump sum plus optional regular deposits grows over time with compound interest.
Open calculator →Project how regular monthly investing plus an expected return builds wealth over time.
Open calculator →Estimate your retirement pot from your current savings and monthly contributions, and the income it could provide.
Open calculator →Disclaimer: Inflation Calculator results are estimates for general information and education only, and are not financial, tax, legal or medical advice. Verify important decisions with a qualified professional.