Inflation Calculator
What money left alone is actually worth later.
Reading your result
Fill in every field and the steps will be spelled out here.
How it is calculated
Holding cash is not a neutral position. At 2.5% a year, money left untouched for a decade buys roughly what 78% of it buys today. Nothing was spent and a fifth of the purchasing power is gone — doing nothing carries a cost of its own.
Real return is the rate minus inflation. Three percent against 2.5% inflation leaves half a point, and tax on the interest can take that below zero. Nominal rates flatter the picture considerably.
The gap compounds. Twenty years is not twice as bad as ten but considerably worse, which is why leaving inflation out of long-horizon planning understates what will actually be needed.
Frequently asked questions
What rate should I assume?
Two percent is a common long-run assumption where central banks target it. Because food and housing tend to outpace the headline figure, 2.5–3% is a reasonable conservative choice for personal planning.
Do wages keep pace?
In some years, not others. When wage growth trails inflation, real income falls — which is the arithmetic behind "the salary went up and things got harder".
Can I use this to make investment decisions?
Only as one input. Expected return, risk and tax for each asset class need looking at separately.
A simple calculation assuming a constant rate. Actual inflation varies year to year and differs sharply by category. Use it alongside other factors, not on its own.