Purchasing power over time. The Inflation Calculator takes amount today, annual inflation rate, years and returns cost of the same goods in the future plus purchasing power of today's amount in the future, loss of purchasing power. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Investment maths is about comparing money at different points in time on a fair basis. Compound rates, discounting and annualised returns let you compare options of different sizes and durations. Use the worked example below to check the maths against your own figures.
How the Inflation Calculator works
Inflation compounds like interest in reverse. At 6% a year, money loses about 44% of its purchasing power in ten years, which is why savings need to earn more than inflation just to stand still.
Worked example
With the example values (amount today of $100,000, annual inflation rate of 6%, years of 10 years), the cost of the same goods in the future is $179,084.77; purchasing power of today's amount in the future $55,839.48, loss of purchasing power 44.16%. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is cost of the same goods in the future calculated?
future cost = amount × (1 + inflation)years; purchasing power = amount ÷ (1 + inflation)years.
Which figures do I need?
Amount today, annual inflation rate, years. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Does the calculator account for taxes and fees?
Only where there is an input for them. For a true net return, add fees and taxes to your inputs or use the stock and crypto profit calculators, which include them.
