Inflation
Calculator
Results
- Future cost
- $121.90
- Purchasing power
- $82.03
Projected cost and purchasing power by year
- Future cost
- Purchasing power
Annual inflation scenario
| 0 | 100.0000 | 100.0000 |
| 1 | 102.0000 | 98.0392 |
| 2 | 104.0400 | 96.1169 |
| 3 | 106.1208 | 94.2322 |
| 4 | 108.2432 | 92.3845 |
| 5 | 110.4081 | 90.5731 |
| 6 | 112.6162 | 88.7971 |
| 7 | 114.8686 | 87.0560 |
| 8 | 117.1659 | 85.3490 |
| 9 | 119.5093 | 83.6755 |
| 10 | 121.8994 | 82.0348 |
Formula
F = P(1 + r)^t; PP = P/(1 + r)^t- P
- 100.00
- r
- 0.02
- t
- 10
= 121.8994
Info
A constant entered rate is a scenario, not a forecast of future CPI or personal inflation.
More in Financial
See all →Frequently asked questions
What does the calculator's inflation-adjusted value actually show?+
It shows what a given amount of money from one point in time is worth in another period's prices, based on the inflation rate you enter, letting you compare purchasing power across years rather than just nominal dollar amounts.
How is future purchasing power calculated?+
The calculator compounds the inflation rate forward over the number of years specified, similar to compound interest but working in reverse on purchasing power, showing how much more it would cost to buy the same goods and services later.
Why does a 'small' 3% inflation rate matter over a long time span?+
Because inflation compounds annually, even a modest rate erodes purchasing power significantly over decades. Money that doesn't grow at least as fast as inflation loses real value every year, even though the number on the balance stays the same.
Is the inflation rate I should use the same every year?+
No, actual inflation varies year to year and by country. The calculator typically uses a constant assumed rate for simplicity, which is a useful estimate but will not exactly match real historical or future inflation, which fluctuates.
How is this different from calculating investment returns?+
Inflation calculations measure the eroding effect of rising prices on money that isn't invested, while investment return calculations measure growth. Comparing the two gives you your real, inflation-adjusted rate of return on any investment.