Inflation Calculator
See how inflation affects your money's future or present value.
What is an inflation calculator, and who needs it?
Inflation is the steady rise in prices, which means the same ₹1,00,000 buys less every year. This calculator works in two directions. Future Cost shows how much you will need later to buy something that costs a given amount today. Today's Value shows what a future amount is worth in today's money.
It is useful for anyone planning a long-term goal such as a child's education, a wedding, retirement or a home purchase. It also helps savers judge whether a deposit or investment is really growing their buying power, and helps employees check whether a salary hike keeps up with rising prices.
Formula used
- Future Cost = Amount today × (1 + Rate ÷ 100) ^ Years
- Today's Value = Future amount ÷ (1 + Rate ÷ 100) ^ Years
- The rate is the yearly inflation rate, and prices are assumed to compound once a year at that same rate
- Rough guide: years for money to lose half its value ≈ 72 ÷ inflation rate
Worked example
Suppose something costs ₹1,00,000 today and inflation is 6% a year. In 10 years the same thing costs 1,00,000 × 1.06^10 = 1,00,000 × 1.7908 = about ₹1,79,085. Each year's rise looks small, yet prices climb by nearly 80% over the decade.
Now reverse it. You will receive ₹10,00,000 twenty years from now, and you want to know what that is worth today at 6%. Today's Value = 10,00,000 ÷ 1.06^20 = 10,00,000 ÷ 3.2071 = about ₹3,11,805. Switch to Today's Value, enter 10,00,000, 6 and 20, and you will see the same result.
Frequently asked questions
What inflation rate should I enter?
There is no single right answer. Use a rate close to what you have seen for the thing you are planning for, because household prices, school and college fees and medical costs often rise at different speeds. Try a few rates, such as 5%, 6% and 8%, to see a range.
What is the difference between Future Cost and Today's Value?
Future Cost starts with an amount at today's prices and tells you how much you will need later to buy the same thing. Today's Value starts with a future amount and shows what it is worth at today's prices.
Is the result the real value of my investment?
No. The calculator only adjusts for rising prices. It does not include interest, returns, tax or fees. To judge an investment, compare its after-tax return with the inflation rate.
How long does it take for money to lose half its value?
A rough guide is 72 divided by the inflation rate. At 6% inflation it takes about 12 years, and at 4% it takes about 18 years.
Why do I see no result when I enter 0% inflation?
The calculator needs an inflation rate other than zero, along with an amount and the number of years, before it shows a result. With 0% inflation prices do not change, so the answer would simply equal the amount you entered.
Limitations and accuracy
The calculator assumes one fixed inflation rate for every year, while real inflation moves up and down. It adjusts for price rises only and does not include investment returns, tax or changes in your lifestyle. Inflation also differs between products and cities, so a general rate may not match your own costs. Use the results for planning and rough comparisons. For official figures, see the Consumer Price Index published by the Ministry of Statistics and Programme Implementation. This tool is for information only and is not financial advice.