Calculate how inflation affects purchasing power over time. Enter an amount, start year, end year, and inflation rate to see future or past equivalent values.
See how inflation erodes purchasing power over time, or find what a past amount is worth in today's money. Enter a starting amount, inflation rate, and number of years.
If your savings account earns 2% annual interest but inflation runs at 3%, you're losing purchasing power every year — your balance grows in nominal terms but buys less in real terms. Money sitting idle in a low-yield account can lose significant value over a decade.
Divide 72 by the inflation rate to estimate how many years it takes for prices to double. At 3% inflation, prices double in roughly 24 years. At 6%, they double in 12 years. This is a quick mental math shortcut used widely in finance.
It means prices rise by 3% annually on average. Something that costs $100 today will cost $103 next year — and after 10 years, roughly $134, due to compounding.
Yes — negative inflation is called deflation. While lower prices sound appealing, sustained deflation can harm economies because consumers delay purchases expecting prices to fall further.
Understanding Inflation: How Rising Prices Erode Your Purchasing Power