Inflation Calculator
Inflation is the quiet tax on cash. This tool shows what today's costs look like in future years.
I ran my own rent through it once and it changed how I think about raises.
At 3 percent a year, prices roughly double in about 24 years. Time hides it well.
How to use this tool
- 1The cost grows by the rate once per year.
- 2Years of growth stack on each other.
- 3The buying power row shows what today's cash feels like then.
The math behind it
Real value = amount / (1 + inflation rate) ^ years (flat rate view)
100 today at 3 percent inflation holds about 74 of today's buying power in 10 years.
That is the quiet tax prices charge while you sleep.
Who this tool is for
I watch which tools folk open most, and this one gets used by the same kinds of people again and again. If any of these sound like you, you are in the right place.
- Folk planing a long goal and wondering why it grows
- Savers deciding if the bank rate beats the leak
- Any one arguing with a price from the old days
I ran my grandads first car price through this tool and the modern sum made me stop teasing him about it. Prices are a river, cash is a boat with a slow leak. This tool shows the leak in plain numbers. Once you see it, idle cash loses its charm.
Tips from me
- Use your country's long run rate, not the scary or the calm headline.
- Run your savings and your salary through it. Both lose or gain power over time.
- Raises below inflation are cuts. Now you can check by how much.
Mistakes I see with this sum
These are the three slips I made my self or watch folk make most. Skip them and your number will be closer to the truth on the first try.
- 1Using one hot year as the forever rate. Rates move in waves.
- 2Forgetting that pay needs to outrun the leak too.
- 3Keeping every thing in cash after seeing the math. Panic is not a plan.
Two words worth knowing
Buying power
What your cash can actually buy.
CPI
Consumer price index. The official price basket most folk quote.
That is the whole page. The tool does the math, and the words above give it a shape. If a number still looks odd, change an input and watch what moves. Playing with the boxes taught me more than any guide did.
Common questions
+What is a normal inflation rate?
Many central banks aim near 2 percent a year. Real life moves above and below that line in waves.
+How do I protect cash from inflation?
Common answers are assets that grow, like funds or property, and less idle cash. Each has risk. Learn before you leap.
+What is inflation in plain words?
Prices rising over time, so the same money buys less. It is why 100 today and 100 in ten years are not friends.
+What rate should I type?
Two to three percent is a common long run guess for many countries. Your national stats office has the real history.
+How do I beat inflation?
Own things that grow with prices, keep fees low and let time work. Cash under the bed always loses this race.