Inflation Calculator
Calculate how inflation affects your purchasing power over time.
Results
Future Purchasing Power$0.00
Purchasing Power Lost$0.00
Percentage Lost0%
Amount Needed to Match Today$0.00
How it works
This calculator shows how inflation reduces the real value of your money:
- Real Purchasing Power: Amount / (1 + inflation)^years
- Future Equivalent: Amount × (1 + inflation)^years
For example, with 3% inflation, $10,000 today will only buy what $7,441 buys in 10 years.
Example
With $10,000 and 3% annual inflation over 10 years:
- Purchasing power drops to: $7,440.94
- You lose: $2,559.06 (25.6%)
- You'd need $13,439.16 to match today's value
FAQ
- What is inflation?
- Inflation is the rate at which the general level of prices for goods and services rises, causing purchasing power to fall. If inflation is 3%, something that costs $100 today will cost $103 next year.
- What is a realistic inflation rate?
- Historically, developed economies target 2% annual inflation. Actual rates vary: the US averaged 2-3% over the past decades, though recent years have seen higher rates of 5-8% in some periods.
- How can I protect against inflation?
- Common strategies include investing in stocks, real estate, inflation-protected securities (TIPS), and commodities. Keeping all savings in cash or low-interest accounts loses value to inflation over time.