Enter Your Details

$
%

Inflation Calculator

Updated January 2026

An inflation calculator reveals how the purchasing power of money changes over time. See what your money was worth in the past or what it will be worth in the future as inflation silently erodes its value.

How to Use This Calculator

Enter the dollar amount, the expected inflation rate, and the number of years. Click Calculate to see how inflation affects your money: the future value (what your money will be worth), the past value (what your money was worth), and the purchasing power lost.

How It's Calculated

The calculator uses the compound inflation formula:

Future Value = Present Value × (1 + inflation_rate)^t

Past Value = Present Value / (1 + inflation_rate)^t

Future value shows what a given amount will be worth after inflation eats away at purchasing power. Past value shows what a given amount was worth in the past, adjusted for inflation.

Frequently Asked Questions

Inflation is most commonly measured by the Consumer Price Index (CPI), which tracks the average change in prices paid by consumers for a basket of goods and services including food, housing, transportation, medical care, and energy. The Bureau of Labor Statistics collects price data monthly from thousands of retailers and service providers. The annual inflation rate is the percentage change in CPI from one year to the next. Historical average inflation in the U.S. is about 3.2% per year.
Due to inflation, $1 from 20 years ago is worth about $1.81 today, meaning the purchasing power of a dollar has nearly doubled over that period. Conversely, $1 today had the purchasing power of only about $0.55 from 20 years ago. This erosion is why financial advisors stress the importance of investing rather than holding cash for long-term goals. Your savings need to grow at least as fast as inflation just to maintain purchasing power.
Inflation silently erodes the purchasing power of your savings. If your savings earn 1% interest but inflation is 3%, you're effectively losing 2% of purchasing power each year. $10,000 in a low-yield savings account would be worth only about $8,700 in today's dollars after 5 years at 3% inflation. This is why long-term savings should be invested in assets that historically outpace inflation — like stocks (avg. 10% return) or real estate.
Yes, inflation can benefit borrowers because you repay loans with dollars that are worth less than when you borrowed them. If you have a fixed-rate 30-year mortgage at 3% and inflation averages 3%, the real cost of your mortgage is essentially zero. This is one reason why long-term fixed-rate debt can be advantageous during inflationary periods — your payment stays the same while your income typically rises with inflation.

Related Calculators

Net Worth Calculator

Calculate your personal net worth

ROI Calculator

Calculate return on investment (ROI)

Break-Even Point Calculator

Find your business break-even point

Credit Card Payoff Calculator

See how long to pay off credit card debt

Debt Payoff Calculator

Compare snowball vs. avalanche methods

Mortgage Calculator

Estimate your monthly mortgage payment with PITI