Inflation Calculator
Understand how inflation impacts your money. Calculate future prices, historical values, and the hidden cost of purchasing power loss.
Future Price
£1,343.92
An item that costs £1,000.00 today will cost £1,343.92 in 10 years at an average inflation rate of 3.00%.
Year-by-Year Breakdown
| Year | Estimated Value | Value Added |
|---|---|---|
| Year 1 | £1,030.00 | +£30.00 |
| Year 2 | £1,060.90 | +£60.90 |
| Year 3 | £1,092.73 | +£92.73 |
| Year 4 | £1,125.51 | +£125.51 |
| Year 5 | £1,159.27 | +£159.27 |
| Year 6 | £1,194.05 | +£194.05 |
| Year 7 | £1,229.87 | +£229.87 |
| Year 8 | £1,266.77 | +£266.77 |
| Year 9 | £1,304.77 | +£304.77 |
| Year 10 | £1,343.92 | +£343.92 |
About This Inflation Calculator
Inflation is the rate at which the general level of prices for goods and services rises, causing purchasing power to fall. While a small amount of inflation can be a sign of a healthy economy, it silently erodes the value of cash savings over time.
This inflation calculator helps you visualize that effect. Use it for retirement planning, salary discussions, future budgeting, or understanding how time and inflation affect your money.
How To Use
Future Price
Estimate how much an item will cost in the future by entering the current price, expected inflation rate, and number of years.
Past Value
Calculate what an amount today would have cost in the past by reversing the inflation formula.
Purchasing Power Loss
See how much less your cash may be able to buy in the future after inflation erodes its value.
Required Future Amount
Calculate how much actual cash you need in the future to match a target amount in today’s money.
Why inflation matters
If your savings grow more slowly than inflation, your real purchasing power falls even if your balance rises.
Frequently Asked Questions
What is a normal inflation rate?v
Inflation varies by country and time period. Many central banks target low and stable inflation, often around 2% per year.
How does inflation affect my savings?v
Inflation reduces purchasing power. If savings earn less than inflation, your money buys less over time.
How can I protect my money from inflation?v
Common approaches include investing in assets that may outpace inflation, reviewing salary growth, and avoiding large idle cash balances.
Is inflation ever a good thing?v
Low, stable inflation can be a sign of economic activity. High or unpredictable inflation is usually damaging.
What is deflation?v
Deflation is a general fall in prices. It can increase purchasing power but may also signal weak demand.
How is inflation measured?v
Inflation is commonly measured using price indexes that track changes in the cost of a basket of goods and services.