Inflation Calculator

Calculate inflation adjusted prices.

Calculators

Inflation Calculator Future Value

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Future Value

Estimated Future Cost
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Inflation Calculator

Inflation is the rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling. This calculator helps you understand how much a specific item, service, or lifestyle will cost in the future.

How does Inflation erode wealth?

If the inflation rate is 6%, a car that costs ₹10 Lakhs today will cost ₹10.6 Lakhs next year. If your money is kept in a savings account earning 3%, your money is actually losing value in real terms.

Future Cost = Present Cost * (1 + Inflation Rate/100)^Years
Example:

If your child's higher education costs ₹15,00,000 today, and you expect they will go to college in 15 years. Assuming education inflation is around 8% p.a.:

Future Cost = 15,00,000 * (1 + 0.08)^15 = ₹47,58,253

You will need nearly ₹48 Lakhs in 15 years to afford the exact same education that costs ₹15 Lakhs today!

Why calculate Inflation?

  • Goal Planning: Whether saving for a house, child's education, or retirement, you must always target the future inflated cost, not today's cost.
  • Investment Choice: Helps you realize that you must invest in assets (like equities) that beat inflation, rather than keeping cash idle.

Frequently Asked Questions

What is inflation?
Inflation is the rate at which the general level of prices for goods and services rises, subsequently eroding the purchasing power of your currency.
Why is calculating inflation important?
It helps you understand the future cost of your financial goals (like education, marriage, or retirement) so you can invest in instruments that offer returns higher than inflation.
What is a real rate of return?
The real rate of return is your investment return minus the inflation rate. If your FD gives 6% but inflation is 7%, your real rate of return is negative.
Can I use this Inflation Calculator for free?
Yes, this Inflation Calculator is completely free to use. You can use it as many times as you want without any hidden charges or registration.
How much time does it take to use the Inflation Calculator?
It takes less than a minute! Our calculator works instantly. Just enter your values in the input fields, and the results, along with visual charts, are generated in real-time.