Free Inflation Calculator

Enter an amount, an inflation rate and a time period to see what that money will be worth in the future — and how much purchasing power is quietly eroded over time.

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Inflation Calculator

Mr B says: Inflation is the invisible tax on savings sitting in a low-interest account. If your savings rate is lower than inflation, your money is losing purchasing power every year.

Amount today

Annual inflation rate (%)

Time period (years)

Inflation impact

Future equivalent value—

Purchasing power lost—

Purchasing power remaining (%)—

⚠️ This tool is for general guidance only and is not financial advice.

Why cash sitting still can quietly lose value

Inflation means that, on average, prices rise over time and the same amount of money buys less than it used to. $10,000 held in cash today, with no growth, will not buy $10,000 worth of goods and services in ten years if prices have risen in the meantime — it will buy whatever that amount is worth after inflation has eaten into its purchasing power. This calculator makes that erosion visible instead of theoretical.

Real return versus nominal return

A savings account paying 3% interest sounds like growth, but if inflation is running at 4% over the same period, the real return is actually negative — the balance is larger in dollar terms but smaller in what it can actually buy. This is why "nominal" returns (the number on your statement) and "real" returns (adjusted for inflation) can tell very different stories, and why long-term saving in low-interest accounts alone rarely keeps pace with rising prices.

How this shapes financial planning

Inflation is one of the main reasons long-term financial goals — retirement, a house deposit five years out, a child's education fund — need a plan that outpaces inflation, not just a plan that grows. Use this calculator to check whether a savings or investment plan is genuinely getting you ahead, or just keeping pace with rising costs, which can look like progress on paper while your actual purchasing power stands still.

Common questions

Inflation questions

What is inflation and how does it affect my money?

Inflation is the general rise in prices over time. As prices rise, each dollar buys less than it did before. At 3% annual inflation, $100 today has the purchasing power of about $74 in 10 years. This is why savings accounts that pay less than the inflation rate are effectively losing real value every year.

What is a normal inflation rate?

In most developed economies, central banks target around 2% per year. Actual inflation varies — periods of 3–5% are common after supply shocks or economic disruptions. Hyperinflation (very high inflation) is much rarer and typically occurs during extreme economic or political crises.

How do I protect my money from inflation?

By investing in assets that historically grow faster than inflation over the long term, such as diversified equities, property, and inflation-linked bonds. Cash in a savings account that earns less than the inflation rate loses purchasing power every year. Spreading across asset classes is the standard approach for managing inflation risk.

How do I calculate the real value of money over time?

Divide the nominal amount by (1 + inflation rate) raised to the power of the number of years. For example: $10,000 in 20 years at 3% inflation = $10,000 ÷ (1.03)^20 = approximately $5,537 in today's purchasing power. This calculator does this automatically.