Inflation is the rate at which the general level of prices for goods and services rises over time, reducing the purchasing power of money. At 3% annual inflation, something that costs $100 today will cost about $134 in ten years.

Inflation Calculator

Find out how inflation erodes purchasing power over time. Calculate future costs, how much you need to save today, or what inflation rate explains a price change between two years.

What do you want to calculate?

Current Amount

Annual Inflation Rate (%)

Number of Years

ⓘ Results are indicative only and do not constitute investment, financial, tax, or legal advice. Consult a qualified professional before making any financial decisions.

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How to Use the Inflation Calculator

Choose the calculation mode that fits your question. The four modes cover the most common inflation scenarios:

Future cost — enter a current price, an annual inflation rate, and the number of years. The calculator shows what that item will cost in the future and how much purchasing power your money loses.
Amount needed today — if you know you will need a certain amount in the future (for example, a renovation that will cost $50,000 in 15 years), this mode tells you how much the equivalent purchasing power is worth today.
Implied inflation rate — enter a past price, a current price, and the number of years between them. The calculator works out the average annual inflation rate that explains the change.
Time to reach target — enter a starting price, a target price, and an annual rate. The calculator tells you how many years it will take for the price to reach the target at that rate.

Click Calculate to see the result. In the first two modes, a chart shows the price trajectory year by year.

Inflation Formula

FV = PV × (1 + r)^t

FV = Future value (what the item costs after inflation)
PV = Present value (current price)
r = Annual inflation rate (as a decimal, e.g. 0.03 for 3%)
t = Time in years

To find the present value: PV = FV / (1 + r)^t

To find the implied rate: r = (FV / PV)^(1/t) − 1

To find the time: t = ln(FV / PV) / ln(1 + r)

Worked Examples

Example 1: Grocery basket

A weekly grocery shop costs $150 today. At 3% annual inflation, how much will it cost in 15 years?

FV = $150 × (1.03)^15 = $233.62. The same basket costs 56% more. Your $150 today has only 64% of its current purchasing power in 15 years.

Example 2: Saving for a future renovation

A kitchen renovation will cost an estimated $30,000 in 10 years. With 4% inflation, how much is that in today's money?

PV = $30,000 / (1.04)^10 = $20,270. If you have $20,270 in savings today with 0% return, you will be short by $9,730 in real terms by the time you renovate.

Example 3: Historical price check

A car that cost $18,000 in 2010 now costs $29,000 in 2025 (15 years). What was the average annual inflation rate for this model?

r = (29,000 / 18,000)^(1/15) − 1 = 3.19% per year.

Example 4: How long until housing doubles?

Average house prices are rising at 6% per year. How long until they double?

t = ln(2) / ln(1.06) ≈ 11.9 years. Using the Rule of 70: 70 ÷ 6 ≈ 11.7 years — very close.

Frequently Asked Questions

What is inflation?

Inflation is the rate at which prices for goods and services rise over time, reducing the purchasing power of money. Central banks such as the Federal Reserve or the ECB target around 2% annual inflation as an indicator of a healthy, growing economy. When inflation is too low, economic activity slows; when it is too high, savings lose value rapidly.

What is a "normal" inflation rate?

Most developed economies target 2% per year. Rates of 1–3% are considered low and stable. Rates of 4–6% are elevated and typically prompt central banks to raise interest rates. Rates above 10% are high inflation, and sustained double-digit inflation is known as hyperinflation. The US averaged around 2–3% from 2000 to 2020, then spiked to over 9% in 2022 before returning to the 3–4% range.

What is the Rule of 70?

The Rule of 70 is a quick mental shortcut: divide 70 by the annual inflation rate to estimate how many years it takes for prices to double. At 2% inflation, prices double in about 35 years. At 7%, in about 10 years. It is an approximation — the more precise formula is t = ln(2) / ln(1 + r) — but the Rule of 70 is accurate enough for everyday estimates.

How does inflation affect savings?

If your savings account earns 1% interest and inflation is 3%, the real value of your money falls by roughly 2% each year. After 10 years at this gap, $10,000 in savings has the purchasing power of only about $8,200 in today's terms. To preserve purchasing power, your savings or investments need to earn at least as much as the inflation rate.

What is the difference between nominal and real value?

Nominal value is the face value — the number in dollars or euros. Real value accounts for inflation and measures actual purchasing power. A 3% salary raise when inflation is 5% is in real terms a pay cut of about 2%. Real GDP, real wages, and real returns all strip out inflation to show whether people are actually better off.

How can I protect money against inflation?

Common strategies include investing in equities (stocks have historically outpaced inflation over long periods), real assets like property or commodities, inflation-linked bonds (TIPS in the US), or index funds. Keeping large amounts in a low-interest savings account is the least effective strategy when inflation is elevated. Even moving money to a high-yield savings account earning close to the central bank rate helps reduce the gap.

What is CPI?

CPI (Consumer Price Index) is the most common official measure of inflation. It tracks the average price change of a fixed basket of goods and services — food, housing, transport, healthcare, and others — that a typical household buys. Central banks and governments use CPI to set interest rates, adjust wages, and index pensions. Other measures include PPI (producer prices) and PCE (personal consumption expenditures, preferred by the US Federal Reserve).