Inflation Calculator
See what today's dollars will cost and buy years from now at any inflation rate — the quiet math behind retirement planning and every raise conversation.
The Fed targets 2%; the long-run US average is closer to 3%.
Two readings of the same math — what today's purchases will cost then, and what today's dollars will buy then. Both matter, and people routinely mix them up.
The same math, read two ways
Enter one amount and this calculator answers two mirrored questions. What will today’s basket of purchases cost after the years pass — and what will today’s dollars still buy? People swap these constantly, and the swap matters — at 3% over 25 years, $1,000 of purchases grows to about $2,090, while $1,000 in cash shrinks to about $478 of buying power.
The official record of the real thing is the BLS Consumer Price Index, which is worth a look just to see how uneven the “average” actually was.
Where this bites hardest
Retirement. A budget that works at 65 meets prices that have doubled by 90. Any plan quoting a flat monthly income for thirty years has already failed — the drawdown calculator applies this erosion to withdrawals automatically, and the difference it makes is never small.
Wages. A salary that does not grow at least with inflation is shrinking in the only sense that matters. The pay raise calculator does that specific subtraction for your next review.
Cash savings. The emergency fund pays an inflation tax as the price of instant access — worth it for the cushion, wasteful beyond it. Money with a horizon past five years belongs where it can outrun the erosion.
The honest caveat
Your personal inflation rate is not the national one — renters in hot metros, parents paying childcare and anyone with medical costs run hotter than the headline. Use the CPI as the floor of your assumption, not the ceiling.
How this is calculated
Future cost = amount × (1 + rate)^years Future buying power = amount ÷ (1 + rate)^years
Frequently asked questions
- What inflation rate should I use?
- The Federal Reserve targets 2%; the long-run US average since 1913 runs closer to 3%; the 2021-2023 spike briefly exceeded 8%. For planning, 2.5 to 3% is a sensible default, with the understanding that reality arrives in lumps rather than a smooth line.
- What is the rule of 72 for inflation?
- Divide 72 by the inflation rate to get the years until prices double — at 3%, about 24 years. It is the fast mental version of what this calculator computes exactly, and a sobering way to think about a retirement lasting three decades.
- Why do my dollars lose value if they just sit there?
- Cash has a fixed face value while prices move. Money in a drawer at 3% inflation loses roughly half its buying power over 24 years. That is the entire argument for keeping long-term savings invested and only short-term money in cash.
- Is some inflation good?
- Central banks think so — a small positive rate keeps wages adjustable and makes cash slightly costly to hoard, which encourages investment. The damage comes from high or unpredictable inflation, which punishes savers and anyone on a fixed income.