Inflation Calculator
Inflation silently erodes the purchasing power of money. $100,000 today is not worth the same as $100,000 in 5 years if annual inflation is 5%. This calculator shows you exactly how much a sum of money stored "under the mattress" will be worth in the future, and how much purchasing power you lose year by year.
Equivalent in the future
Value today
Cumulative loss
Year-over-year loss of value
Projection based on a constant rate. Actual inflation varies year to year.
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How it works
The formula is FV = PV × (1 + r/100)^t, where PV is the present value (money today), r is the annual inflation rate as a percentage, and t is the time in years. The result FV indicates how much money you would need in the future to have the same purchasing power that PV has today. The difference FV − PV represents the purchasing power loss in monetary terms.
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Preguntas frecuentes
- What is inflation and how does it affect my savings?
- Inflation is the general and sustained increase in prices. If annual inflation is 5% and you have $100,000 in cash, the following year you will need $105,000 to buy the same things. Your $100,000 will have lost purchasing power in real terms.
- How do I protect my savings from inflation?
- The most common tools are: high-yield savings accounts with rates above inflation, inflation-linked bonds (TIPS in the US), stocks in companies that pass inflation on to prices, real estate, and foreign currency assets. The goal is for your investment return to exceed the inflation rate.
- What is cumulative inflation?
- It is the total impact of inflation over several years. It is not the sum of annual rates, but the compound product. If inflation was 5% in year 1 and 6% in year 2, the cumulative inflation is (1.05 × 1.06 − 1) × 100 = 11.3%, not 11%.
- Where can I find the official inflation rate for my country?
- In the US: Bureau of Labor Statistics (bls.gov). In the UK: Office for National Statistics. In the EU: Eurostat. In Canada: Statistics Canada. Central banks of each country also publish inflation projections for coming years.
- Can I use this calculator to adjust rental prices?
- Yes, as an estimate. Rental contracts often use specific indices (CPI, for example) rather than general inflation. You can use this calculator as an approximation by entering the expected inflation for the lease period.