Inflation Calculator — future prices & today's purchasing power

How it works

The same exponent runs both directions. Forward: future cost = A(1+r)^y — the compound-growth arithmetic, applied to a price instead of a balance. Backward: purchasing power = A ÷ (1+r)^y — what today's dollars still buy after y years of erosion. The two are exact mirrors (their product is always A²), and the doubling clock ln 2 ÷ ln(1+r) says how long the assumed rate takes to double prices — the Rule of 72's territory. The rate here is deliberately an input, not a claim: this page asserts no historical average and carries no CPI series, so the honest use is running the range you consider plausible and reading the spread.

Worked example

The arithmetic is the published compound case in price clothing: $3,000 growing at 7% for four years reaches $3,932.39 (LibreTexts' worked example) — read here as a $3,000 expense inflating at a 7% assumption for four years. On the default inputs — $1,000 at an assumed 3% over ten years — the same exponent gives about $1,344 as the future cost, $744 as what today's $1,000 will still buy, and roughly 23.4 years for prices to double: this calculator's arithmetic on the assumption you set.

Frequently asked questions

How does inflation compound?

Exactly like interest: each year's price rise applies to the already-risen price, so a steady 3% lifts costs by more than 30% over ten years, not 30% flat. The exponent (1+r)^y captures it, and the doubling clock makes the long-run effect concrete.

What inflation rate should I assume?

This page won't pick for you — future inflation is unknown, and a single historical average would quietly go stale. Run the range you consider plausible (the presets offer a moderate and a high scenario) and treat the spread of results, not one number, as the planning input.

Why is purchasing power the mirror of future cost?

Because they are the same exponent from opposite ends: if prices rise by (1+r)^y, a fixed sum of money buys 1/(1+r)^y as much. The sweep shows both columns moving together — cost climbing exactly as fast as power falls.

Can I see what something cost in a past year?

Not on this page — historical conversions need the actual CPI series (the BLS index), which is real data with a maintenance schedule rather than arithmetic. This page is the forward-looking, assumption-driven half; a CPI-backed historical mode would be its own dated data table.

How does inflation interact with my savings rate?

Subtract, roughly: money earning 5% under 3% inflation grows about 2% a year in real purchasing power (precisely, 1.05/1.03 − 1). Any return below the inflation assumption loses ground in real terms even while the balance grows — worth checking against the savings calculators' outputs.

How fast do prices double?

At the assumed rate r, in ln 2 ÷ ln(1+r) years — about 23.4 years at 3%, 10 years at 7%. The Rule of 72 approximates the same clock as 72 divided by the rate in percent, and the rule-of-72 calculator shows how close that shortcut runs.

How accurate is this, and what does it exclude?

The arithmetic is exact for a constant assumed rate; reality's rate varies year to year and across categories — housing, food, and services inflate differently. It excludes the actual CPI series, category weights, and your personal basket, so treat the outputs as scenario arithmetic, not forecasts.