Inflation Calculator
Inflation is the steady rise in prices that makes each unit of money buy a little less over time. At 3% a year, prices double about every 24 years, so what costs $1,000 today costs roughly $1,344 in ten years — and $1,000 kept in cash will only buy what $744 buys today. This calculator works in three directions: from a price today to its likely future cost, from an amount of money to its future purchasing power, and from two actual prices to the average annual inflation rate between them. It uses a rate you supply rather than historical index data, so the results are as realistic as your assumption.
How to use the inflation calculator
- Choose what you want to find: a future cost, a future buying power, or an implied inflation rate.
- Enter the amount and the number of years.
- Enter an annual inflation rate — or, for the third option, the later price instead.
- Compare scenarios such as 2%, 3% and 5% to see how sensitive long-term plans are to the rate.
Formula
Future cost = amount × (1 + r)years. Purchasing power = amount ÷ (1 + r)years. Implied annual inflation = (later price ÷ earlier price)1 ÷ years − 1. The “Rule of 72” gives a quick doubling time: 72 ÷ the rate in percent (72 ÷ 3 = 24 years).
Worked examples
A future price
Something that costs $1,000 today will cost $1,343.92 after 10 years of 3% inflation, a cumulative rise of 34.39%.
Money left in cash
$1,000 under the mattress for 10 years at 3% inflation has the purchasing power of just $744.09.
Implied inflation from two prices
A meal that cost $12 in 2016 and costs $17.50 now (10 years later) implies average inflation of 3.85% a year — a total rise of 45.83%.
Inflation at a glance
What $1,000 is worth after 10 and 20 years
| Inflation rate | Buying power after 10 years | After 20 years |
|---|---|---|
| 2% | $820.35 | $672.97 |
| 3% | $744.09 | $553.68 |
| 4% | $675.56 | $456.39 |
| 5% | $613.91 | $376.89 |
Rule of 72
Divide 72 by the inflation rate to estimate years for prices to double: at 3%, about 24 years; at 6%, about 12. See also the compound interest calculator, which shows the growth side of the same maths.
Practice problems
Try these yourself first, then check your answer. The answers come from the calculator above.
- What will a $250 weekly food bill be after 15 years of 3.5% inflation?
Show answer
What costs $250.00 today will cost in 15 years: $418.84
- A coffee cost $2.50 in 2010 and $4.75 now (16 years later). What average annual inflation is that?
Show answer
Average annual inflation: 4.09%
Common mistakes to avoid
- Using one inflation rate for everything. Housing, healthcare, education and food can rise faster or slower than the headline figure.
- Forgetting to inflate a goal. A retirement target of $60,000 a year “in today’s money” needs a much larger nominal figure later.
- Confusing a lower rate of inflation with falling prices. Prices still rise, just more slowly (disinflation).
- Comparing nominal returns with inflation. Subtract inflation to get the real return: 6% growth with 3% inflation is about 2.9% real.
- Treating this as a forecast. Future inflation is uncertain; use ranges.
Frequently asked questions
How do I calculate inflation over several years?
Multiply by (1 + rate) for each year: amount × (1 + r)^years. At 3% for 10 years that is a factor of about 1.34.
What is purchasing power?
What a sum of money can actually buy. Inflation reduces it: $1,000 at 3% inflation buys about what $744 buys today after 10 years.
What is the Rule of 72 for inflation?
Divide 72 by the annual inflation rate to estimate how many years it takes prices to double. At 4%, about 18 years.
What is the real rate of return?
The return after inflation: (1 + nominal) ÷ (1 + inflation) − 1. It shows how fast your buying power actually grows.
Does this use official CPI data?
No. It uses the rate you enter, so you can model any scenario. For historical figures, check your national statistics agency.
Is this financial advice?
No. It is an educational calculator.
Sources and further reading
- U.S. SEC Investor.gov — Inflation (glossary)
- U.S. SEC Investor.gov — Compound interest calculator and explainer
By Thomas M, Registered Investment Adviser (South Carolina), who launched his own financial advisory firm in 2010. Last reviewed September 26, 2026. Found a mistake? Tell us; see our editorial policy.