Finance · Interest and investing
See how inflation changes a money amount
An amount, a constant annual rate, a period. Compound forward, or bring a later sum back to today’s purchasing power.
Calculate
How the calculator works
Inflation is treated like compound interest: each year the price level is multiplied by (1 + r). Forward, multiply. Backward, divide by the same factor. You pick the rate; no CPI series is fetched.
Formula and method
future = A × (1 + r/100)^n
Annual compounding of the price level.
past = A ÷ (1 + r/100)^n
Discount a current sum back n years.
A constant-rate assumption, not the BLS CPI-U. Central banks often aim near 2% without promising it. Housing does not move like groceries. Type the rate that matches the basket you care about, including a negative rate for deflation.
Worked example
$10,000 at 2.5% for 10 years
$10,000, 2.5%, 10 years, forward.
- Factor = 1.025^10 ≈ 1.28008.
- 10,000 × 1.280 ≈ 12,801.
About $12,801 for the same basket.
Input notes
- Amount
- The starting sum, in one currency.
- Annual inflation rate
- Assumed average annual rate. 2% is a policy target, not last year’s CPI.
- Period
- Horizon in years. 0 leaves the amount unchanged.
- Direction
- Forward: how much for the same basket. Back: what that sum used to buy.
Assumptions and limits
Assumptions
- A constant rate each year.
- Annual compounding, not monthly.
- One homogeneous basket.
Limits
- No official CPI series.
- No category-level inflation (energy, rent, food).
- Not a forecast.
How to read the result
At 2.5% a year, prices double in a little under 29 years (rule of 72). A savings account that yields less than this rate loses purchasing power even when the balance rises.
Common mistakes
Multiplying by 2.5% × 10 = 25%.
Inflation compounds: 1.025^10 ≈ +28%, not +25%.
Using last year’s CPI for 20 years.
The past rate is not the future rate. You are stating an assumption.
Comparing with a return that is already real.
Strip inflation only once.
Comparison
| Rate | Factor | Future amount |
|---|---|---|
| 1% | 1.105 | $11,046 |
| 2.5% | 1.280 | $12,801 |
| 5% | 1.629 | $16,289 |
Related calculations
- Compound interestGrow a single principal at a nominal annual rate with a chosen compounding frequency, including continuous compounding. The page also reports the effective annual rate. There are no recurring deposits on this form.
- CAGRCAGR is the fictional constant annual rate that would take a starting value to an ending value in n years. It smooths the trip: a crash and a rebound disappear into one number.
- Hourly to salaryThree numbers: hourly rate, weekly hours, paid weeks. The tool returns the week, the calendar month (year / 12) and the year.
- Simple interestInterest is proportional to principal, rate, and time. It does not itself earn interest. Use this only when a contract is actually simple, not as a stand-in for savings compounding.
- Savings with monthly depositsProjects a starting balance and constant monthly deposits, credited at month-end, with an annual nominal rate converted as monthly = annual / 12. It is a fixed-rate scenario, not a market forecast.
- ROIROI here is a simple ratio of gain (or loss) to cash put in. It does not know whether the outcome took a month or a decade. CAGR is the tool that uses years.
Frequently asked questions
Which inflation rate should I use?
The one you assume, not a single truth.
The Fed’s 2% target is a landmark, not a promise. For rent, a housing index may fit better. This page stays transparent: the rate is yours.
Is this the same math as compound interest?
Yes, with a price rate instead of a yield.
Both are (1+r)^n. Here r erodes money; there it grows a balance.
Can the rate be negative?
Yes, for deflation.
A −1% rate lowers the price level. Forward, you need less money; backward, today’s dollar bought fewer goods.
Author and update
Written by Rédaction HexaCalc (editorial team). Content last updated: August 25, 2026. No third-party medical or financial review is claimed.
This calculation uses a standard mathematical identity. See also the methodology.
Compare with a savings yield?
Compound interest shows a balance growing at a constant rate, before inflation.
Compound interestCategory: Finance