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Inflation Calculator

See how inflation erodes purchasing power over time.

Adjusted Value$2,033
Total Change$1,033
Percent Change103.28
Purchasing Power Lost$508
How this is calculated

Adjusted = Amount x (1 + rate/100)^years

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Frequently Asked Questions About Inflation Calculator

An inflation calculator shows how the purchasing power of money decreases over time due to inflation. It helps you understand what past dollar amounts are worth in today's money or vice versa.

+What is inflation and how does it work?
Inflation is the general increase in prices of goods and services over time, which reduces the purchasing power of money. If inflation is 3% per year, items that cost $100 today will cost $103 next year. This means the same amount of money buys less.
+What is a typical inflation rate?
Average inflation in developed countries typically ranges from 2-3% annually over long periods. However, rates vary: 2022-2023 saw higher inflation (8%+), while some periods see below 1%. Historical average US inflation is about 3.22%.
+How does inflation affect my savings?
If your savings account earns 1% interest but inflation is 3%, you're actually losing purchasing power (negative real return). To maintain or grow wealth, your investments should return more than the inflation rate. This is why savers seek higher-yield accounts or invest in growth assets.
+Why is inflation important for retirement planning?
Inflation means you'll need significantly more money in the future to maintain your current lifestyle. A retirement plan must account for inflation to determine realistic savings goals. This calculator helps you see how much you'll actually need in future dollars.
+What's the difference between nominal and real returns?
Nominal return is the percentage your investment grows (e.g., 8% per year). Real return is after accounting for inflation. If you earn 8% but inflation is 3%, your real return is about 5%. Real returns show true purchasing power growth.
+How much will $1 million be worth in 20 years?
At 3% annual inflation, $1 million will have the purchasing power of about $553,000 in today's dollars. Use this calculator with $1,000,000, a 20-year period, and your expected inflation rate to see the real value.