See what an amount of money today will cost in the future, because of inflation.
The amount compounds at the inflation rate for the chosen number of years.
Future cost: Amount × (1 + inflation)ⁿ
An inflation calculator shows how much money you will need in the future to buy what a given amount buys today. You enter today's amount, an expected yearly inflation rate and a number of years, and it compounds the amount forward.
In India, prices of most things, from school fees and rent to groceries and hospital bills, rise every year. A household that spends ₹50,000 a month today will need much more for the same lifestyle in fifteen years. This calculator puts a number on that, which is the first step in setting realistic targets for retirement, education or any long-term goal.
It works for any cost: monthly expenses, a car's price, a wedding budget or a year's college fees.
1. Note today's amount A, the expected yearly inflation π% and the number of years n.
2. Convert the rate: π ÷ 100.
3. Compute the inflation factor: (1 + π ÷ 100)ⁿ.
4. Future cost = A × (1 + π ÷ 100)ⁿ.
5. To go the other way, and find what a future amount is worth at today's prices, divide it by the same factor.
6. Try two or three inflation rates to see a range rather than a single figure.
If prices rise 6% this year, next year's 6% rise applies to the already higher price. So after n years, prices are (1 + π)ⁿ times today's, not 1 + nπ. At 6%, prices double in about 12 years and nearly quadruple in 24. The formula is identical to compound interest, which is why the inflation and future value calculators share their maths. The difference is meaning: future value is what your money becomes, while the inflation figure is what you need just to stand still.
Official consumer price inflation in India is measured by the Consumer Price Index, which tracks a fixed basket of goods and services weighted by how much an average household spends on each. Your own inflation depends on your basket. Food has a large weight in the index. Education, healthcare and housing costs have often risen faster than the headline figure. A family planning for college fees or a retiree budgeting for medical costs should use a higher rate than the headline average for those items.
The same formula, read backwards, tells you how much a rupee loses. Money that sits idle for n years buys only 1 ÷ (1 + π)ⁿ of what it buys today. At 6% for 10 years, ₹1 lakh kept in cash will buy what about ₹56,000 buys now. This is why savings earning less than inflation are losing real value, even though the balance never falls. It also explains why real returns, not nominal ones, are what grow your wealth.
Latha's family spends ₹2,50,000 a year on household essentials, and she wants to know what the same basket might cost in 15 years if prices rise 5.5% a year.
Answer: Equivalent cost in the future ₹5,58,119
Multiplying the rate by the years instead of compounding.
Using a single low inflation figure for costs such as education or healthcare.
Setting a retirement or education goal at today's prices.
Assuming a recent low inflation reading will persist for decades.
Confusing the future cost with how much your savings will grow to.
Estimating future household expenses for retirement planning.
Inflating a goal amount before working out the SIP needed.
Showing why cash kept idle loses value over time.
Comparing old prices with today's, such as a salary or a property value from years ago.
How is this different from the Future Value calculator?
The maths is exactly the same — this one is about inflation reducing your buying power, while Future Value is about investment growth. Both use the same compounding formula.