Inflation Calculator
See what something will cost in future at a given inflation rate, or what a future amount is worth today.
Future cost
1.79 lakhYear-wise cost
| After | Cost | Price rise so far |
|---|---|---|
| 1 yr | ₹1,06,000 | 6% |
| 2 yr | ₹1,12,360 | 12.4% |
| 3 yr | ₹1,19,102 | 19.1% |
| 4 yr | ₹1,26,248 | 26.2% |
| 5 yr | ₹1,33,823 | 33.8% |
| 6 yr | ₹1,41,852 | 41.9% |
| 7 yr | ₹1,50,363 | 50.4% |
| 8 yr | ₹1,59,385 | 59.4% |
| 9 yr | ₹1,68,948 | 68.9% |
| 10 yr | ₹1,79,085 | 79.1% |
How today's cost grows at this inflation rate.
How it works
Future cost of something that costs C today:
Future cost = C × (1 + g)t
Reverse: what an amount F in the future is worth in today's money:
Today's value = F ÷ (1 + g)t
Share of purchasing power lost over the period:
Purchasing power lost = 1 − 1 ÷ (1 + g)t
- g = inflation rate as a decimal (6% = 0.06)
- t = number of years (part years allowed)
Prices are assumed to rise at the same rate every year, with each year's rise applied on top of the last.
Worked example
Future cost: something costs ₹1,00,000 today and prices rise 6% a year for10 years.
- (1 + 0.06)10 = 1.790848
- Future cost = ₹1,00,000 × 1.790848 = ₹1,79,084.77
- Purchasing power lost = 1 − 1 ÷ 1.790848 = 44.16%
Reverse: ₹10,00,000 (10 lakh) received in 15 years, at6% inflation.
- (1 + 0.06)15 = 2.396558
- Today's value = ₹10,00,000 ÷ 2.396558 = ₹4,17,265.06
Frequently asked questions
What is inflation?
Inflation is the rate at which prices of goods and services rise over time. RBI's Financial Awareness Messages give a simple example: if 1 kg of apples costs ₹100 this year and ₹110 next year, inflation is 10%. As prices rise, the same money buys less.
How does this calculator work out future costs?
It grows today's cost by the inflation rate every year, with each year's rise applied on top of the last: future cost = today's cost × (1 + inflation)^years. It works with part years too, such as 2.5 years.
What does the reverse mode do?
It answers the opposite question: what a future amount is worth in today's money. For example, ₹10,00,000 received in 15 years, with 6% inflation, buys about as much as ₹4,17,265 does today. This is the present value of that amount at the inflation rate.
What does "purchasing power lost" mean?
It is how much less the same amount of money will buy after inflation. At 6% a year for 10 years, money loses about 44.16% of its purchasing power, so ₹1,00,000 then buys what about ₹55,839 buys today.
What inflation rate should I use?
Use the rate you think fits the thing you are planning for. Some costs, such as education or healthcare, can rise faster than general prices. The rate shown by default is only a starting value, not a forecast. Try a higher rate too, to see a more cautious estimate.
Why does inflation matter for my savings?
If your savings earn less than inflation, they lose value in real terms. RBI's Financial Awareness Messages illustrate this: money earning 6% when inflation is 4% has a real return of about 2%, while cash earning nothing loses about 4% a year.
Can I use this to plan a goal?
Yes. Enter today's cost of the goal to find its future cost, then use that amount as the target in the goal SIP calculator to work out the monthly investment needed.