Goal
Find the monthly amount that gets you to a target by a date, such as a down payment or school fees.
Savings and loans
Inflation and purchasing power calculator
See what prices could do to a sum of money over the years, for an inflation rate you choose.
A cost you expect, or a sum you hold.
% a year
A rate you choose. Not a forecast.
years
% a year
An assumption, used for the real return and the saving needed. Use 0 for cash.
With prices rising 6% a year, what costs ₹1 lakh today costs ₹1.79 lakh in 10 years. The same ₹1 lakh held as cash would buy what ₹55,839 buys today.
- What the amount buys then, if held as cash
- ₹55,839In today's rupees. 44.2% of its buying power is gone.
- Real return
- 1.89%Your assumed return after taking out inflation. A negative figure means prices outpace the money.
- Cost of the same things then
- ₹1,79,085≈ ₹1.79 lakh, which is ₹79,085 more than today.
Cost and buying power, year by year
Tap or hover the chart, or use the slider, to read any year.
- Cost then of what the amount buys today
- The amount held as cash, in today’s rupees
- The amount invested, in today’s rupees
After 10 years
Cost then of what the amount buys today
₹1,79,085
The amount held as cash, in today’s rupees
₹55,839
The amount invested, in today’s rupees
₹1,20,553
Year-by-year table
| Year | Cost then of what the amount buys today | The amount held as cash, in today’s rupees | The amount invested, in today’s rupees |
|---|---|---|---|
| 0 | ₹1,00,000 | ₹1,00,000 | ₹1,00,000 |
| 1 | ₹1,06,000 | ₹94,340 | ₹1,01,887 |
| 2 | ₹1,12,360 | ₹89,000 | ₹1,03,809 |
| 3 | ₹1,19,102 | ₹83,962 | ₹1,05,768 |
| 4 | ₹1,26,248 | ₹79,209 | ₹1,07,763 |
| 5 | ₹1,33,823 | ₹74,726 | ₹1,09,797 |
| 6 | ₹1,41,852 | ₹70,496 | ₹1,11,868 |
| 7 | ₹1,50,363 | ₹66,506 | ₹1,13,979 |
| 8 | ₹1,59,385 | ₹62,741 | ₹1,16,130 |
| 9 | ₹1,68,948 | ₹59,190 | ₹1,18,321 |
| 10 | ₹1,79,085 | ₹55,839 | ₹1,20,553 |
Keeping up with it
- Amount invested at the return, thenWorth ₹1,20,553 in today's rupees.
- ₹2,15,892
- Monthly saving that keeps the goal's real valueTo have the future cost above, at the assumed return.
- ₹972
- Or one sum today
- ₹82,951
What this assumes
- Inflation and the return are the rates you typed. Real inflation differs between items and years, and returns can be negative.
- Prices rise once a year at the rate; the monthly saving is put in at the start of each month.
- The 4%, 6% and 8% buttons are examples to try, not forecasts.
What this does not do
- Inflation for any particular item such as school fees or medical care.
- Tax on the returns.
- A forecast of inflation or returns.
- Whether to save or invest.
What next
SIP
See what a fixed monthly investment in a mutual fund could grow to, for a return you assume.Retirement
Estimate the corpus your expenses need through retirement, what you are on track for, and the monthly gap.SWP
See how long your money lasts when you withdraw a fixed amount every month.
How it works
If prices rise by a steady rate each year, the same things cost more later, and a fixed sum buys less. You pick the rate and the years; the page does the rest.
Future cost = amount x (1 + inflation)^years. Buying power = amount / (1 + inflation)^years
The real return of an investment is what is left after inflation: (1 + return) / (1 + inflation) - 1. The monthly saving that keeps a goal's real value is the future cost divided by what one rupee saved every month grows to at your assumed return.
A worked example
With inflation at 6% for 10 years, something that costs ₹1,00,000 today costs ₹1,79,085 then. ₹1,00,000 held as cash buys what ₹55,839 buys today, a loss of 44.2%. If the money instead earns 8% a year, the real return is 1.89%, and saving ₹972 a month would reach the future cost.
What it leaves out
- Different inflation for different items such as school fees, medicine or property.
- Tax on the returns.
- A forecast of inflation. The 4%, 6% and 8% buttons are examples, not predictions.
Questions people ask
What inflation rate should I use?
The page does not pick one. Try a few rates, such as the 4%, 6% and 8% examples, to see how much the answer moves. Those are examples, not forecasts.
What is purchasing power?
It is how much a sum of money can buy. When prices rise, the same rupees buy less, so the purchasing power of a fixed sum falls.
What is a real return?
It is a return after taking out inflation. A 10% return with 6% inflation is about 3.8% in real terms, since the money grows by about 3.8% more than prices do.
Why is the real return not just the return minus inflation?
Because both compound. The exact figure is (1 + return) / (1 + inflation) - 1. For small rates the simple subtraction is close.
Can this tell me how much to save?
It shows the monthly saving that would reach a goal’s future cost at the return you assume. That is arithmetic on your assumptions, not advice about what to do.