Inflation Calculator
See how inflation erodes purchasing power over time.
About the Inflation Calculator
Inflation quietly shrinks what your money can buy. The AlarmDaddy Inflation Calculator shows the future cost of something that costs a given amount today, and how much purchasing power your cash loses if it just sits idle.
Enter an amount, the number of years, and an average annual inflation rate. The calculator shows what that amount will cost in the future at the same standard of living, and the purchasing power lost. It is a powerful argument for investing rather than holding cash — pair it with the ROI and 401(k) calculators to see how investment growth can outpace inflation.
How to use this calculator
- 1Enter an amount in today's dollars.
- 2Enter the number of years.
- 3Set an average annual inflation rate (US long-run average is around 3%).
- 4Read the equivalent future cost and purchasing power lost.
The formula
Inflation compounds annually. Multiplying today's amount by (1 + rate) for each year gives the equivalent future cost. The reciprocal shows how much real purchasing power a fixed cash amount loses over the same period.