Last updated 3 September 2026
Two views of the same thing
Future cost answers "how much will I need to spend later to buy what this amount buys today" — the price simply rises. Purchasing power flips the question: "how much would today's amount actually be worth, in today's terms, if I waited to spend it" — the same erosion, described as a shrinking value instead of a rising price.
Why your inflation is not the headline figure
A national inflation rate is a weighted average across a basket of goods and services, weighted to represent typical household spending. Your own rate depends on how your spending differs from that basket. A household spending a large share of its income on rent, energy and food experiences something quite different from one whose main costs are a fixed mortgage payment and discretionary spending, particularly when those categories move at different speeds.
This is why a reported figure of 3% can feel wrong. It is not that the figure is inaccurate; it is that it describes a hypothetical average household. If the categories rising fastest happen to be the ones you spend most on, your personal rate is genuinely higher, and using the headline number to plan will understate what you need.
Assumptions and limitations
What the maths does. It compounds the single inflation rate you enter across the number of years you enter. Nothing is looked up — there is no price index behind this tool and no historical data is used.
One average rate is a simplification. Real inflation moves year to year, sometimes sharply, and a long-run average hides periods that were far higher or lower. Different countries run at very different rates.
Official inflation is not your inflation. A consumer price index measures a representative basket of goods and services. Your own spending — rent or mortgage, food, energy, transport, childcare, healthcare — is weighted differently, so your personal experience of price rises can differ substantially from the headline figure.
Assumptions that apply to every finance calculator here
Currency is a display choice only. Changing the currency symbol relabels the output; it does not convert anything and no exchange rate is used anywhere in this tool.
Tax and lending rules vary by country. Nothing here is adjusted for the rules where you live — income tax, capital gains tax, stamp duty, lending caps, affordability tests and consumer-credit regulation all differ, and several of them can change the real answer materially.
Rates and returns are not guaranteed. Any rate you enter is treated as fixed for the whole period. Real interest rates move, real investment returns vary year to year and can be negative, and past performance does not predict future results.
This is an estimate, not advice. The result is arithmetic on the numbers you typed. It is not an offer, a quote, an approval, an investment recommendation or financial advice. Before committing to anything, get figures from the actual lender, provider or a qualified adviser in your country.
Common questions
What inflation rate should I use?
There's no single right answer — it depends on your country and the period. Many economies target roughly 2% long-term, though actual rates vary a lot year to year. Use your central bank's target or recent average as a starting point.
What's the difference between the two results?
Future cost answers "how much will the same goods cost later." Purchasing power answers "how much would today's amount actually buy, valued in today's terms, if you waited to spend it." They're two ways of describing the same erosion of value.
Is this the same as compound interest?
Mathematically yes, the same exponential formula — but here it's working against your money's value instead of growing it. Investment returns need to beat the inflation rate just to maintain real purchasing power, not just show a positive number.