Inflation Calculator

How inflation changes the value of money

Inflation is the steady rise in prices over time, which means each unit of money buys a little less every year. This calculator shows that effect two ways. In future cost mode it tells you what something that costs a given amount today will cost after a number of years at a chosen annual inflation rate — useful for budgeting, retirement planning, or estimating a future purchase. In past value mode it tells you the purchasing power today of an amount from the past, so you can compare prices, salaries, or savings across years on an equal footing.

The math is a simple compounding formula. Future cost multiplies the amount by (1 + rate) once for each year; past value divides by the same factor. The tool also reports cumulative inflation — the total percentage prices have risen (or your money has lost) over the whole period — so you can see the compounded impact at a glance. Everything is computed locally in your browser; no amounts are uploaded or stored.

Frequently asked questions

What annual inflation rate should I use? Long-run consumer inflation in many developed economies has averaged roughly 2–3% per year, but it varies by country and period. Use a rate that matches your situation, or try a few to see a range.

What is the difference between future cost and past value? Future cost projects forward — what a price will grow to. Past value looks backward — what an old amount is worth in today's money. They are inverses of each other at the same rate and number of years.

Why is cumulative inflation higher than rate times years? Because inflation compounds. Each year's increase is applied on top of the previous year's higher prices, so the total is more than simply adding the annual rate for each year.

Does this predict actual future prices? No. It is a what-if model based on the constant rate you enter. Real inflation changes year to year, so treat the result as an estimate, not a forecast.