Inflation Calculator

How to use this calculator

1. 1Enter an amount in today’s money — a monthly grocery bill, an emergency fund, a savings target: anything whose future cost or value you want to see.
2. 2Choose an average annual inflation rate. The 3% default sits near the long-run U.S. average; try 2% (the Fed’s target) and 4% to see the band.
3. 3Set the horizon in years — a decade makes the effect vivid; a working lifetime makes it decisive.
4. 4Read the two curves: what the amount will cost at future prices, and what today’s money will still buy. The gap between them is the tax idle cash pays.

How the calculation works

future cost = amount × (1 + r)^n
remaining buying power = amount ÷ (1 + r)^n
value lost = amount − remaining buying power

Compounding applied to the price level: r is the average annual inflation rate as a decimal and n the number of years. The second line is the same equation inverted — dividing by the price multiple converts future prices back into today’s dollars, which is exactly what "real" values mean in financial planning.

Worked example

Assumptions and important notes

• A single average rate compounds annually across the whole horizon; real inflation jumps and dips around that average, so any specific year will differ.
• The amount is treated as a fixed basket of goods; real households shift what they buy as relative prices change.
• Deflation (falling prices) is outside the model — the rate floor is 0%.
• No taxes or account yields are modeled; this isolates the inflation effect alone.

Frequently asked questions