Calculate Inflation Impact
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Fill in the values and click calculate to see how inflation affects your money over time.
How It Works
This inflation calculator helps you understand how inflation affects the purchasing power of your money over time.
Key Concepts
- Nominal Value: The face value of money without accounting for inflation
- Real Value: The actual purchasing power of money after accounting for inflation
- Purchasing Power Loss: The percentage of value lost to inflation, calculated as:
100% - (Real Value ÷ Nominal Value × 100%)
Example
If $100 today becomes $150 in nominal terms after inflation, but the real value (purchasing power) is only $90:
- Purchasing Power Loss = 100% - ($90 ÷ $150 × 100%)
- Purchasing Power Loss = 100% - 60% = 40%
- This means inflation has reduced the purchasing power by 40%
Note: This calculator uses compound inflation to provide a more accurate picture of how inflation erodes purchasing power over time. The results can help you make better decisions about long-term savings and investments.