What today's money will be worth later

Inflation impact

Calculate how inflation erodes the purchasing power of a sum of money over time.

Formula

real value = amount ÷ (1 + inflation rate)^years

Assumptions

• Inflation rate is assumed constant over the whole period, which real-world inflation rarely is.

Frequently asked questions

Why does the same amount buy less in the future?
Prices tend to rise over time, so a fixed sum of money loses purchasing power even if the number itself doesn't change. This calculator shows what today's amount would be worth in today's terms after that erosion.

What inflation rate should I use?
There's no single right answer — a common planning assumption is 2-4% per year, but check your country's recent historical average for a more grounded estimate.