Inflation Calculator
Calculate the future value of money adjusted for inflation, or find the real value of a past amount in today's dollars.
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How to use this calculator
Compound the inflation rate over the number of years to find how much purchasing power changes.
- 1
Enter the amount you want to evaluate.
- 2
Enter the expected or historical annual inflation rate.
- 3
Enter the number of years.
- 4
See how much purchasing power changes and what the equivalent future amount is.
Frequently asked questions
What formulas does this tool use?
This tool uses Future Cost = Amount × (1 + i)^years and Buying Power = Amount ÷ (1 + i)^years, where i is the annual inflation rate ÷ 100. Cumulative inflation is (1 + i)^years − 1. The rate is applied once per year, compounded.
Why are Extra Needed and Purchasing Power Lost different numbers?
They are measured in different money. Extra Needed is in future money: what you would have to add to keep buying the same things (8,061.11 in the default case). Purchasing Power Lost is in today’s money: how much of your amount’s buying power disappears (4,463.24). Same price rise, two denominators.
Does the tool look up actual inflation data?
No. It has no index data. You enter a single constant annual rate and the number of years, and it compounds that. For a real past period you would enter the average yearly rate you obtained from a published index; for the future, an assumed rate.
Can I convert an old amount into today’s money?
Yes, indirectly. Enter the old amount, the average yearly rate over the period, and the years elapsed. The first result row is then what the old amount would cost in today’s terms. For example, 500 at 6% over five years comes to 669.11.
What happens at 0% or negative inflation?
At 0% every output equals the starting amount and cumulative inflation is 0.0%. A negative rate is treated as falling prices: 1,000 at −1% for five years costs 950.99 later, buying power rises to 1,051.54, and extra needed is negative. A starting amount of 0 returns 0 amounts while still showing the cumulative rate.
Is the rate a percentage, and are fractional years allowed?
Enter 3 for 3%. Years can be fractional because the exponent accepts decimals. The rate is assumed to be an effective annual figure and not a monthly one.
What does it ignore?
Interest or returns you might earn on the money, taxes, wage growth, and the fact that prices of different goods rise at different speeds. The result is an illustration of one constant rate from your inputs, not a forecast or advice.
Inflation arithmetic: future cost and buying power
Two views of one price change
When prices rise at a steady yearly rate, the same basket of goods costs more later and a fixed sum buys less. The calculator shows both sides: how much you would need in future money to buy what the amount buys today, and how much of today’s buying power the amount retains. They come from the same factor, (1 + i) raised to the number of years.
Worked example: 10,000 over 20 years at 3%
The goods that 10,000 buys today would cost $18,061.11 after 20 years, so $8,061.11 more is needed to stay level. Looked at the other way, the original 10,000 would buy only what $5,536.76 buys today, a loss of $4,463.24 in today’s money. Cumulative inflation is 80.6%. Lowering the rate to 2% and stretching to 30 years gives a very similar overall rise, 81.1%.
Different rates, horizons and directions
The table puts five runs together. The 6% case shows a short horizon at a high rate, the 0% row is the control that shows no change, and the negative-rate row demonstrates deflation, where the future cost is lower than the starting amount.
| Amount, rate, years | Future cost | Buying power (today’s money) | Cumulative |
|---|---|---|---|
| 10,000, 3%, 20 | $18,061.11 | $5,536.76 | 80.6% |
| 500, 6%, 5 | $669.11 | $373.63 | 33.8% |
| 10,000, 2%, 30 | $18,113.62 | $5,520.71 | 81.1% |
| 1,000, 0%, 10 | $1,000.00 | $1,000.00 | 0.0% |
| 1,000, −1%, 5 | $950.99 | $1,051.54 | −4.9% |
Why the rate and the time compound
Each year’s price increase applies to prices that have already risen, which is why 20 years at 3% adds 80.6% and not 60%. Plain multiplication of rate by years understates the total, and the gap widens with time. This is the same compounding that governs savings, only working against a fixed sum instead of for a growing one.
Using the output sensibly
Pick a rate that reflects the period you are studying and try a few values on either side. The calculation holds one rate steady, whereas real price changes vary by year and by category, and the tool includes none of the returns you could earn on the money. The numbers illustrate your inputs and are not a prediction. To set a savings rate against inflation, run the tool at the rate you assume and read the buying-power row: an amount earning less than that rate each year loses buying power, and the last two rows give the size of the shortfall in today’s money.
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Results are estimates for informational purposes only and do not constitute professional financial, medical, legal, or technical advice. Read full disclaimer →