Inflation & Purchasing Power
Inflation calculator for future costs and purchasing power lost — plus city cost-of-living comparison for the same salary.
Inflation inputs
See how inflation grows costs and erodes the purchasing power of money over time.
Future cost
₹1,79,085
Same goods in 10 years
Purchasing power left
₹55,839
Of today's ₹1,00,000
Purchasing power lost
44.2%
Erosion of real value
Cumulative inflation
79.1%
At 6% p.a.
To buy what ₹1,00,000 buys today, you will need about ₹1,79,085 in 10 years.
About Inflation & Purchasing Power
The Inflation Calculator shows how prices can rise over time and how purchasing power of a fixed rupee amount falls — plus an optional city comparison using editable cost-of-living indices.
What inflation planning is for
Inflation is why a goal stated in today’s rupees understates tomorrow’s cost. Education, healthcare and city living often inflate faster than a broad CPI average. This tool makes that gap visible before you size SIPs or retirement corpus.
How this calculator works
Inflation tab: enter today’s amount, annual inflation % and years. You get future cost, remaining purchasing power of today’s amount, and total inflation %. Purchasing-power tab: enter a salary and city COL indices (100 = baseline) to rank how far the same salary stretches across places.
Formula / methodology
Future value = amount × (1 + inflation)^years. Purchasing power of a fixed amount after years = amount / (1 + inflation)^years. City real salary = salary × (100 / city COL index). City indices on this page are editable illustrations — not official government indices unless you paste those yourself.
Worked example
₹1,00,000 today at 6% inflation for 15 years becomes about ₹2,39,700 in future cost. The same ₹1,00,000 left uninvested would buy only about ₹41,700 of today’s goods — roughly a 58% loss of purchasing power in this illustration. Use 4–6% for broad India CPI-style scenarios; try higher rates for education or healthcare goals.
Advantages
Prevents under-saving for long-dated goals. Separates “rupees in the bank” from “what those rupees buy.” City comparison helps when considering a relocation or remote salary.
Assumptions and limitations
A single inflation rate cannot capture every basket. Official CPI series change methodology over time. City indices here are user-editable planning aids. Pair with Goal Planner or Retirement Calculator after you inflate the target.
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Frequently Asked Questions
- How does the inflation calculator work?
- Future cost = amount × (1 + inflation%)^years. Purchasing power left = amount ÷ (1 + inflation%)^years.
- What inflation rate should I use for India?
- Long-term CPI often sits near 4–6%. Use RBI targets or your own expense inflation if housing/education run hotter.
- What is purchasing power comparison?
- It ranks cities by real salary using a cost-of-living index (100 = baseline). Higher index means the same rupees buy less.
- Are city COL indices official?
- Defaults are illustrative for comparison. Edit the indices to match any COL source you trust.
- How should I use this with retirement planning?
- Inflate today’s expenses first, then feed the higher lifestyle cost into the Retirement Calculator or Goal Planner.
- How is this different from FX conversion?
- Inflation/purchasing power is about prices over time or across cities — not exchange rates. Use the Currency Converter for FX.