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Wealth Planner
Personal Finance

Inflation Calculator

See how inflation impacts your money

Private
Instant
Estimate
Future cost₹3,20,714

Inputs

₹1,00,000
in rupees

6%
in percent

20 years
in years

Results

Future cost
₹3,20,714
What ₹1,00,000 of spending today costs in 20 years at 6% a year
In today's money₹31,180
Buying power after 20 years
  • Buying power left31%
  • Buying power lost69%

Future cost and buying power

Both lines start at today's amount: one is what it will cost, the other what it will buy.

₹1,00,000 today grows in cost to ₹3,20,714 after 20 years, while its buying power falls to ₹31,180.
₹1,00,000 today grows in cost to ₹3,20,714 after 20 years, while its buying power falls to ₹31,180.

Year-wise breakdown

Year-wise breakdown
YearFuture costBuying power
Today₹1,00,000₹1,00,000
1₹1,06,000₹94,340
2₹1,12,360₹89,000
3₹1,19,102₹83,962
4₹1,26,248₹79,209
5₹1,33,823₹74,726
6₹1,41,852₹70,496
7₹1,50,363₹66,506
8₹1,59,385₹62,741
9₹1,68,948₹59,190
10₹1,79,085₹55,839
11₹1,89,830₹52,679
12₹2,01,220₹49,697
13₹2,13,293₹46,884
14₹2,26,090₹44,230
15₹2,39,656₹41,727
16₹2,54,035₹39,365
17₹2,69,277₹37,136
18₹2,85,434₹35,034
19₹3,02,560₹33,051
20₹3,20,714₹31,180

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Assumptions and methodology

Transparent calculation notes for Inflation Calculator.

Methodology notes

Formula used

Future value after inflation
Future value = current amount x (1 + inflation rate)^years

The calculator estimates how much future money is needed to match today's purchasing power.

Methodology

  • Apply the selected inflation rate for each year.
  • Calculate future nominal value.
  • Compare future value with today's amount to show purchasing power impact.

Core assumptions

  • Inflation stays constant for the full period.
  • The same inflation rate applies to the user's spending basket.
  • Amounts are nominal before tax or investment return.

Not included

  • Real inflation can vary by category, city, and time period.
  • Lifestyle changes and one-time expenses are not modeled.

About Inflation Calculator

Guide

1What is Inflation?

Inflation is the rate at which the general level of prices for goods and services rises, eroding the purchasing power of money over time. In India, inflation is measured primarily through the Consumer Price Index (CPI) and the Wholesale Price Index (WPI).

Understanding inflation is crucial for financial planning because it determines how much your money will be worth in the future. An investment that does not outpace inflation results in a real loss of purchasing power, even if the nominal value grows.

2How Inflation Affects Your Money

  • Purchasing Power: ₹1,00,000 today at 6% inflation will buy only ₹55,839 worth of goods in 10 years
  • Real Returns: If your investment returns 8% and inflation is 6%, your real return is only about 2%
  • Goal Planning: A goal that costs ₹10 lakh today will cost ₹18 lakh in 10 years at 6% inflation
  • Retirement Risk: Inflation is the biggest silent threat to retirement savings

3Inflation Formula

The future cost of goods after inflation is calculated as:

Future Value = Present Value × (1 + inflation rate)^years

To find the present value of a future amount:

Present Value = Future Value / (1 + inflation rate)^years

Headline CPI inflation averaged roughly 5% a year from FY2016-17 to FY2024-25, with yearly averages between about 3.4% and 6.7%, and it was higher in the decade before. Education and healthcare costs often rise faster than the headline rate.

4How to Use This Inflation Calculator

  • Step 1: Enter the current cost of an item or your total expenses
  • Step 2: Set the expected inflation rate (e.g., 6% for general, 10% for education)
  • Step 3: Input the number of years into the future
  • Step 4: See what the same goods or lifestyle will cost in the future

Frequently Asked Questions

FAQ
What is India's current inflation rate?
India's headline retail inflation is the year-on-year change in the Consumer Price Index (CPI), which MoSPI (the Ministry of Statistics) publishes around the 12th of every month. Since February 2026 it uses a new series with 2024 as the base year. The rate moves a lot: it fell to 0.25% in October 2025, the lowest in the 2012-base series, and was above 7% in parts of 2022. The RBI's target is 4%, with a tolerance band of 2% to 6%, retained until 31 March 2031. For long-term plans, 5-6% a year is a common assumption. Check the latest MoSPI CPI release for this month's figure.
Why is education inflation higher than general inflation?
Education costs in India have been rising at 10-12% annually, significantly higher than general inflation. This is driven by increasing demand for quality education, infrastructure costs, faculty salaries, and the growing importance of supplementary education.
How do I protect my investments from inflation?
Look for investments that have grown faster than inflation over long periods, such as diversified equity funds, and use hedges such as gold in moderation; returns vary and are not guaranteed. Money in a savings account usually loses value after inflation: as of September 2026, large banks paid about 2.5-3% a year on savings, below CPI inflation of about 4-5%.
What is the difference between CPI and WPI?
CPI measures price changes from the consumer perspective (retail prices) and is used for inflation targeting by RBI. WPI measures wholesale price changes and reflects producer-level inflation. CPI is more relevant for personal financial planning.
Should I use different inflation rates for different goals?
Yes. Use 6-7% for general living expenses, 10-12% for education costs, 8-10% for healthcare, and 5-6% for rent (varies by city). Using category-specific inflation makes your financial plans more accurate.