Inflation is the steady rise in prices over time. It quietly reduces what your money can buy. ₹1 lakh sitting idle today will buy much less in ten years. This calculator shows both sides of the same effect: how much things will cost in the future, and how much today's money will be worth then.
How to use the inflation calculator
- Enter an amount or cost today, such as a monthly budget, a school fee or your savings.
- Enter the expected inflation rate.
- Enter the number of years.
You will see the future cost, the increase in cost, and what the same amount will really be worth at the end of the period.
Inflation formulas
Future cost = Today's cost × (1 + inflation ÷ 100)^years
Purchasing power = Today's amount ÷ (1 + inflation ÷ 100)^yearsExample
At 6% inflation for 10 years:
- Something that costs ₹1,00,000 today will cost about ₹1,79,085
- ₹1,00,000 kept aside today will only buy what about ₹55,839 buys today
How prices grow over time
₹1,00,000 at 6% inflation:
| Years | Future cost | What ₹1 lakh will be worth |
|---|---|---|
| 5 | ₹1,33,823 | ₹74,726 |
| 10 | ₹1,79,085 | ₹55,839 |
| 20 | ₹3,20,714 | ₹31,180 |
| 30 | ₹5,74,349 | ₹17,411 |
At 6%, prices roughly double every 12 years (72 ÷ 6 = 12). A family spending ₹50,000 a month today would need about ₹2,14,594 a month in 25 years for the same lifestyle.
Why it matters for your money
- Savings must beat inflation. If your savings earn 6% and inflation is also 6%, your money is not really growing. See the FD calculator and compare its return with inflation.
- Goals cost more than you think. Education and healthcare costs have often risen faster than general inflation. Plan goals in future money with the goal SIP calculator.
- Retirement lasts decades. Your expenses keep rising after you stop working. The retirement calculator includes inflation for the full retirement period.
FAQ
What inflation rate should I use?
Over long periods, consumer inflation in India has often been in the range of about 4–7% a year. Many people plan with 6%. For education or medical costs, a higher rate such as 8–10% can be safer.
What is purchasing power?
It is how much your money can actually buy. When prices rise, the same number of rupees buys less, so its purchasing power falls.
How do I calculate the real return on an investment?
Roughly, subtract inflation from the return. An FD earning 7% with 6% inflation gives a real return of about 1%. For an exact figure, use (1 + return) ÷ (1 + inflation) − 1.
Can inflation be negative?
Yes. Falling prices are called deflation. It is rare for long periods in India. You can enter a small rate to explore low-inflation scenarios.