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Inflation Calculator

See how inflation raises a price over time.

Result

$1,480.24
$480.24

How it is calculated

The tool compounds a constant annual rate: future cost = amount × (1 + rate / 100) ^ years. The amount is what something costs today, the rate is the yearly inflation in percent and years is the length of time, which may be a fraction. The second figure is the increase, future cost − amount. It assumes the same rate every year, so real inflation that varies will give a different answer. Years cannot be negative. The money is shown in dollars, though the maths works for any currency.

Worked example

Something that costs 1,000 today, at 4% inflation for 10 years. Growth factor: 1.04 ^ 10 ≈ 1.4802. Future cost: 1000 × 1.4802 = $1,480.24. Increase: 1,480.24 − 1,000 = $480.24. In other words you would need about 1,480 then to buy what 1,000 buys now.

Try this example →

Common mistakes

  • Entering 0.04 for 4%. The rate is a percentage, so 4 is correct.
  • Adding the rate for each year (4% × 10 = 40%) rather than compounding. Compounding gives 48.02%.
  • Assuming one future rate holds for many years. Inflation changes, so treat long projections as rough scenarios.
  • Reading the answer as what your salary must be. It shows only the price level; raises are a separate figure.

Sources

About this calculator

This calculator projects how much a given amount of money will effectively cost, or how much purchasing power it will lose, after a number of years of inflation at a chosen annual rate, using the same compounding formula as compound interest applied to prices instead of savings.

It's used to translate an abstract inflation rate — the kind reported monthly by a country's statistics office — into something concrete, like what a grocery basket or a rent payment costing a certain amount today will likely cost in five or ten years at the current rate. Savers and retirees use it to check whether a savings account's interest rate is actually keeping pace with inflation, and employees use it to judge whether a raise is really a raise once rising prices are accounted for.

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Comments (1)

  • Editorial team

    A single headline rate rarely matches your own spending. Rent, food and energy often move at different speeds, so try running them separately with their own rates and add the results. The compounding also bites hard at high rates: 1,000 at 50 percent a year for three years becomes 3,375, not 2,500. Which expense do you most want to project, and what yearly rate do you use for it?

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