Inflation Calculator
Calculate the future cost of goods and the erosion of your purchasing power due to inflation. See year-by-year impact on your money's real value.
Inputs
Result
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Future Cost
💡 Formula
Inflation Impact
- Future Cost = Present Cost × (1 + r)ⁿ.
- Your purchasing power drops inversely: today's ₹1,00,000 at 6% inflation buys only ₹55,839 worth of goods in 10 years.
- India's CPI has averaged 5–6% historically.
🎯 Sector Inflation
Different rates for different needs
- General CPI: ~5–6% per year
- Education costs: ~8–10% annually
- Healthcare / medical: ~10–12%
- Real estate (metro): ~6–8%
- Food inflation: ~4–7%
⚠️ Why it matters
Plan for inflation
- Your investments must earn more than inflation for real growth
- FD at 7% with 6% inflation = only 1% real return
- Retirement planning must account for 25–30 years of inflation
- Use this to set financial goals at future prices
Frequently Asked Questions
What is India's average inflation rate?▾
India's Consumer Price Index (CPI) inflation has averaged around 5–6% over the last decade. RBI's target is 4% with a ±2% band. However, education and healthcare inflate at 8–12% annually.
How does inflation affect my savings?▾
If your savings earn less than inflation, you're losing purchasing power every year. A savings account at 3.5% with 6% inflation means a real loss of 2.5% annually. Always aim for returns that beat inflation.
How should I adjust my financial goals for inflation?▾
Multiply your current target by the inflation factor. If your child's college costs ₹20L today and they'll attend in 15 years, at 8% education inflation you'll need ₹20L × (1.08)¹⁵ ≈ ₹63.4L.