About the Inflation Calculator
This inflation calculator shows how inflation erodes the value of money. Find out how much you will need in 10 or 20 years to buy what $10,000 buys today (future value), or what a future sum such as a pension, a bond payout or a retirement goal is worth in today’s dollars (present value). It also shows the cumulative price increase, the loss of purchasing power and how long it takes for money to lose half its value.
How to use
- Choose Today → future or Future → today’s dollars.
- Enter the amount and the number of years.
- Enter an annual inflation rate. The default 3% is an example; the Fed targets 2%.
- Read the result, cumulative inflation, loss of purchasing power and the yearly table.
Inflation formulas
With annual inflation i over n years:
- Future cost = amount today × (1 + i)n
- Present value = future amount ÷ (1 + i)n
- Loss of purchasing power = 1 − 1 ÷ (1 + i)n
Example: at 3% a year, something that costs $10,000 today will cost $13,439.16 in 10 years, and $10,000 received in 10 years is worth $7,440.94 today. Prices rise 34.4% and purchasing power falls 25.6%.
Rule of 70: how fast money loses half its value
Divide 70 by the inflation rate to estimate how many years it takes for prices to double (and money to lose half its value).
| Inflation | Years to halve (exact) | $100,000 in 20 years, in today’s $ |
|---|---|---|
| 2% | 35.0 | $67,297 |
| 3% | 23.4 | $55,368 |
| 5% | 14.2 | $37,689 |
Which inflation rate should I use?
- The Federal Reserve aims for 2% inflation over the longer run (measured by PCE prices).
- The Consumer Price Index (CPI-U) published monthly by the Bureau of Labor Statistics is the most widely quoted measure; it varies from year to year, so long-term plans often assume 2.5–3%.
- Some costs, such as healthcare, college tuition and housing, have historically risen faster than average inflation.
FAQ
What will $100,000 be worth in 20 years?
At 3% inflation, $100,000 in 20 years has the purchasing power of about $55,368 today. At 2% it is about $67,297.
How do I adjust a past amount for inflation?
Choose Today → future and enter the past amount, the number of years since then and the average inflation rate over that period. For exact historical values, use the BLS CPI inflation calculator, which uses actual CPI data.
What is the real interest rate?
Roughly the nominal interest rate minus inflation. A savings account paying 4% when inflation is 3% grows your purchasing power by only about 1% a year.
Can I calculate deflation?
Yes. Enter a negative inflation rate such as −1 and the calculator shows money gaining value over time.