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Inflation & Purchasing Power Calculator

See how inflation erodes the future purchasing power of your savings, or estimate the future cost of an item.

Inflation Projections

Understand the future value of your money adjusted for inflation:

Future Cost

The higher budget needed in the future to purchase the same basket of goods.

Purchasing Power Left

The relative purchasing power value of your cash capital over the period.

Net Loss

The total value eroded from your savings if they are not invested in inflation-beating assets.

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How is it calculated?

FV = PV \times (1 + i)^n \quad | \quad PV = \frac{FV}{(1 + i)^n}

Where FV is future cost, PV is present cost, i is annual inflation rate, and n is number of years.

Worked Examples

₹10,000 Expense in 20 Years at 6% Inflation

Due to the compound compounding rate of inflation, a monthly budget of ₹10,000 today will require ₹32,071 in 20 years just to buy the exact same goods.

Purchasing Power Loss

At a 6% inflation rate, ₹1 Lakh cash stored in a locker will only have the purchasing power of ₹55,839 in 10 years.

Frequently Asked Questions

How does inflation affect my investments?
To grow real wealth, your investments must generate a return rate higher than the inflation rate. If your return is 6% and inflation is 5%, your real growth rate is only 1%.
What is CPI inflation?
Consumer Price Index (CPI) measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.
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Results are estimates and should not be considered financial advice.

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