Inflation Calculator
Calculate how inflation affects the purchasing power of money over time
Calculate Future Value
Results
Absolute change in value
Relative change in value
Compound annual growth rate
Year by Year Breakdown:
Understanding Inflation
Inflation is the rate at which the general level of prices for goods and services rises, consequently decreasing purchasing power over time. Understanding inflation helps you make better financial decisions and plan for the future.
Key Concepts
- • Consumer Price Index (CPI)
- • Purchasing power
- • Cost of living adjustments
- • Real vs. nominal values
- • Inflation expectations
Types of Inflation
- • Demand-pull inflation
- • Cost-push inflation
- • Built-in inflation
- • Hyperinflation
- • Stagflation
How Inflation Affects Your Money
Savings Impact
- • Reduced purchasing power
- • Lower real returns
- • Emergency fund value
- • Cash holdings risk
- • Interest rate effects
Investment Impact
- • Bond value changes
- • Stock market effects
- • Real estate appreciation
- • Commodity prices
- • Portfolio adjustments
Income Impact
- • Wage adjustments
- • Fixed income challenges
- • Social Security benefits
- • Retirement planning
- • Purchasing power parity
Protecting Against Inflation
Investment Strategies
TIPS (Treasury Inflation-Protected Securities)
Government bonds that adjust principal based on inflation
I Bonds
Savings bonds with inflation-adjusted interest rates
Real Estate
Property values and rents tend to rise with inflation
Commodities
Raw materials often increase in price with inflation
Financial Planning
- • Diversify investments
- • Adjust savings rate
- • Review fixed expenses
- • Consider variable rate debt
- • Negotiate salary increases
- • Build emergency reserves
- • Monitor inflation trends
- • Update financial goals
Historical Inflation Perspective
Notable Periods
High inflation combined with economic stagnation
Period of declining inflation rates
Deflationary pressures and monetary policy response
Post-pandemic supply chain disruptions and stimulus effects
Price Comparison Over Time
Example: $100 in 1970
- • 1980: $216
- • 1990: $319
- • 2000: $432
- • 2010: $566
- • 2020: $672
- • 2024: $747