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Inflation

What will today's money
be worth later?

Enter an amount, an inflation rate and a number of years. See what the same things will cost then, and what the same cash will buy.

Your figures

$
%

What it will cost in 10 years

$1,344

$1,000 today buys, in 10 years
$744
Loss of buying power
25.6%
Price rise
34.4%
Year by year
Year Future cost Buying power
1$1,030$971
2$1,061$943
3$1,093$915
4$1,126$888
5$1,159$863
6$1,194$837
7$1,230$813
8$1,267$789
9$1,305$766
10$1,344$744

In plain terms

Inflation compounds, the same way interest does

A few per cent a year looks harmless in any single year; over a decade it reprices everything you plan for.

Inflation is the rate at which prices rise, and like interest it compounds: each year's rise is applied to prices that have already risen. At 3% a year, something costing 1,000 today costs 1,343.92 in ten years. Run the other way, 1,000 kept as cash for those ten years buys what 744.09 buys today — it has lost about a quarter of its purchasing power without a single unit leaving the account. The two figures are reciprocal: one multiplies the amount by the growth in prices, the other divides by it. A negative rate models deflation, when prices fall.

The rate you enter is the whole assumption, so it is worth choosing deliberately. The latest official figures, for July 2026, were 3.4% for US consumer prices (CPI-U, Bureau of Labor Statistics), 2.9% for UK CPI (Office for National Statistics) and a provisional 4.45% for India's combined CPI on its new 2024 base (Ministry of Statistics and Programme Implementation). Each is superseded every month, and a single year's reading is a poor guide to a decade. Your own inflation can also differ from the national basket, depending on what you spend your money on.

Central bank targets are the other anchor. The Reserve Bank of India targets 4% CPI inflation within a band of 2–6% for April 2026 to March 2031. The US Federal Reserve aims for 2%, measured on PCE inflation rather than CPI, and the Bank of England's target is 2% CPI, set by the Government. A target is what a central bank aims for, not a forecast. For a long horizon, try the target and a higher rate, and plan around the range between the two results rather than a single number.

US CPI-U, July 2026
3.4% over 12 months (Bureau of Labor Statistics, released 12 August 2026).
UK CPI, July 2026
2.9% (Office for National Statistics, released 19 August 2026).
India CPI, July 2026
4.45%, provisional; combined index, base 2024=100 (MoSPI, released 12 August 2026).
Targets
RBI 4% CPI, 2–6% band, 1 April 2026 – 31 March 2031 · Federal Reserve 2% PCE · Bank of England 2% CPI.

How it's calculated

The working behind the number

This inflation calculator compounds a single annual inflation rate over whole years. It answers two questions about the same amount: what goods costing that much today will cost at the end of the period, and what that sum held as cash will buy then, in today's money. The two are reciprocal, and a negative rate models deflation. It uses the rate you enter, not a published index.

Formula

Future cost = A × (1 + r)ᵗ · Purchasing power = A ÷ (1 + r)ᵗ

A
The amount, in today's money.
r
The annual inflation rate as a decimal: 3% is 0.03. Negative for deflation, down to −10%.
t
The number of whole years, from 1 to 100.

Assumptions and limits

  • The same inflation rate applies in every year of the period.
  • It applies equally to everything, as a price index does; the prices you pay may rise faster or slower.
  • Purchasing power assumes the cash earns nothing. Money earning interest loses less, or gains.
  • Figures are kept at full precision and rounded to two decimal places only when shown.
  • The published readings quoted on this page are dated and are not updated automatically.

A worked example

Take $1,000 of spending today and prices rising 3% a year for 10 years.

  1. Future cost = $1,000 × (1 + 3%)^10.
  2. Purchasing power = $1,000 ÷ (1 + 3%)^10.

The same things would cost $1,344, and $1,000 would buy what $744 buys today.

Computed by the calculator on this page, from the figures it opens with.

Sources

By The CutYears team · Last reviewed 10 September 2026 · Full methodology

Questions people ask

What inflation rate should I use?

For a long horizon, not last month's figure. Try your central bank's target — 4% in India, 2% in the US and the UK — and a higher rate, and treat the gap between the two results as your range. The latest readings (July 2026: US 3.4%, UK 2.9%, India 4.45% provisional) are listed above with their dates; each is replaced monthly.

What is the difference between future cost and purchasing power?

They answer the same question from opposite sides. Future cost is what goods priced at your amount today will cost at the end of the period. Purchasing power is what your amount, held as cash, will buy then, measured in today's prices. At 3% over ten years, 1,000 has a future cost of 1,343.92 and a purchasing power of 744.09.

Why is the Federal Reserve's 2% target not measured on the CPI?

The Federal Reserve states its 2% goal in terms of PCE inflation — the price index for personal consumption expenditures — not the consumer price index most headlines quote. So the 3.4% CPI-U reading for July 2026 is not directly comparable with the Fed's target. Enter whichever measure matches what you are planning for.

Can I enter a negative inflation rate?

Yes, down to −10% a year. A negative rate is deflation: prices fall, so the future cost comes out below today's amount and the purchasing power of cash rises above it. Treat a long run of negative years as a what-if rather than a plan.

Keep going

The tools and guides that answer the questions this one raises.