Inflation Calculator
Calculate purchasing power change and inflation-adjusted value
Enter values above to calculate
How to Use
- Enter the monetary amount you want to adjust for inflation.
- Enter the starting year (from year).
- Enter the target year (to year).
- Enter the assumed annual inflation rate (default is 3%).
- Click 'Calculate' to see the inflation-adjusted value and purchasing power change.
About Inflation
What is Inflation?
Inflation is the rate at which the general price level of goods and services rises over time, eroding the purchasing power of money. If inflation is 3% per year, something that costs $100 today will cost $103 next year. Over 20 years at 3%, the same item costs $180.61 — an 80.6% increase.
Inflation Formula
Future Value = Present Value × (1 + inflation rate)^years. Purchasing Power Change = (Adjusted Amount / Original Amount − 1) × 100%. If $1,000 in 2000 equals $1,806 in 2020 at 3% inflation, then the purchasing power of that $1,000 decreased — you need $1,806 today to buy what $1,000 bought in 2000.
Historical Inflation Rates
US CPI inflation has averaged about 3.1% annually since 1913. China has averaged about 3–4% over the past 30 years. The 1970s saw US inflation peak at over 13%. Most central banks target 2% inflation as a healthy economic level. Hyperinflation (above 50% monthly) has occurred in Zimbabwe, Venezuela, and Weimar Germany.
Real vs. Nominal Values
Nominal values are actual dollar amounts without inflation adjustment. Real values are adjusted for inflation. A salary increase from $50,000 to $52,000 (4% nominal raise) with 5% inflation actually represents a 1% pay cut in real terms. Always use real (inflation-adjusted) values when comparing money across different time periods.
Key Features
- Calculates inflation-adjusted value for any amount and time period
- Customizable inflation rate (default 3%)
- Shows both the adjusted amount and percentage purchasing power change
- Displays cumulative inflation percentage for the entire period