Inflation Calculator
Use this free inflation calculator to see what rising prices do to your money. Enter an amount, a yearly inflation rate and the number of years. The calculator shows what the same things will cost in future, and how much less today’s amount will buy.
How this inflation calculator works
The calculator raises the amount by the inflation rate each year. For example, something that costs ₹1,00,000 today would cost about ₹3.21 lakh after 20 years at 6% inflation. Looked at the other way, ₹1,00,000 kept aside for 20 years would buy only what about ₹31,180 buys today, a fall of about 69% in buying power. The table shows both figures for every year. The result is an illustration, not a forecast.
Why inflation matters for investing
Money that earns less than inflation loses buying power, even though the amount looks the same. This is why long-term goals, such as retirement or a child’s education, are planned using the future cost rather than today’s cost. Our Goal SIP calculator and Retirement calculator build inflation into their results.
What this calculator does not include
It uses one steady inflation rate for every year. Real inflation changes from year to year and differs by item. Education, healthcare and housing have often risen faster than the overall average, so try a higher rate for expenses that you expect to rise faster.
Frequently asked questions
What inflation rate should I use?
Everyday costs in India have risen by roughly 5 to 7 percent a year over long periods, though the figure varies from year to year. The calculator starts at 6%. It is wise to test a higher rate too, particularly for education and medical costs.
What does “buying power” mean?
Buying power is how much a given amount of money can purchase. If prices double, the same amount buys only half as much, so its buying power halves, even though the number on the note stays the same.
Is the result guaranteed?
No. The result depends entirely on the inflation rate you enter, and actual inflation will differ. Learn more about investing on the AMFI investor awareness site.
How can I protect my money from inflation?
Investments that have the potential to earn more than inflation over the long term can help your money keep its buying power, but returns are not guaranteed and every investment carries risk. Talk to us about which options suit your goals and your comfort with risk.