Inflation Calculator – Future Value of Money
Calculate the impact of inflation on purchasing power. See how much today's money will be worth in the future.
📊 Finance📐 Future Value = Present Value × (1 + inflation rate)^years
Amount today ($)
Inflation rate (%)
Years
Please enter valid values.
Formula & Reference
| Variable | Formula | Units |
|---|---|---|
| Inflation Calculator – Future Value of Money | Future Value = Present Value × (1 + inflation rate)^years | $ |
Step-by-Step Examples
Example 1
$10K over 20 years
$10,000, 3% inflation, 20 years.
- Future cost: $18,061
- Purchasing power: $10,000 is worth $5,537 in today's dollars
✓ $18,061 future / $5,537 real value
Example 2
Retirement Savings
$1M at retirement — what is it worth in 25 years at 3%?
- Equivalent today: $477,606
- Need $2.09M in 25 years for $1M in real value
✓ $1M = $477K in today's dollars
Example 3
High Inflation 6%
$50,000, 6% inflation, 10 years.
- Future cost: $89,542
- Purchasing power halves in about 12 years at 6%
✓ $89,542 future
Real-World Applications
Savers
See how inflation erodes savings.
Investors
Understand real vs nominal returns.
Retirees
Plan for rising costs in retirement.
Economists
Quick inflation impact calculations.
Common Mistakes to Avoid
⚠️
Ignoring inflation in retirement planning
A $5,000/month lifestyle today costs $9,000+/month in 25 years at 3% inflation. Always plan for inflation.
⚠️
Confusing nominal and real returns
A 7% investment return with 3% inflation = 4% real return. Real return = (1+nominal)/(1+inflation) - 1.
Frequently Asked Questions
Average US inflation rate? ▾
~3% historically over the long run. 2% was the Fed's target pre-2020. Post-2021 inflation peaked at 9% in 2022, now returning to 3%.
Rule of 70 for inflation? ▾
Years to halve purchasing power = 70 ÷ inflation rate. At 3%: 70/3 = 23 years.
Best inflation hedges? ▾
Stocks (historically beats inflation), TIPS (Treasury Inflation-Protected Securities), real estate, commodities, I-bonds.