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Inflation Calculator: Future Purchasing Power

Use this US inflation calculator to see what a dollar today is actually worth in the future. CPI-based inflation calculator with the historical 2.9% US average — adjust the rate to model any scenario.

$
%
yrs
Future equivalent value$0.00
Purchasing power loss$0.00
Real value in today's dollars$0.00
Return needed to break even0.00%
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How this calculator works

Inflation compounds just like investment returns — each year's price level is the base for the next year's increase:

Future Value = Present Value × (1 + inflation rate)years
Future Value
How many dollars you would need in the future to buy what Present Value dollars buy today
Present Value
The amount in today's dollars
Inflation rate
Annual rate as a decimal (3% → 0.03)
Years
Time horizon

Real value is the inverse: how much today's dollars are worth after inflation — Present Value ÷ (1 + rate)years. The break-even return is simply the inflation rate itself; any investment return above it preserves purchasing power, any return below it loses ground.

Historical US inflation: The CPI averaged ~2.9% from 2000–2023, but spiked to 9.1% in June 2022 — a 40-year high. The Fed's long-run target is 2%.

Source: CPI data from the Bureau of Labor Statistics Consumer Price Index. Historical averages calculated from BLS CPI-U series.

FAQ

What inflation rate should I use?
For general planning, use 2.5–3% (US long-run CPI average). The Fed's target is 2%. For healthcare costs, use 4–6% — medical inflation runs higher. For retirement projections, 3% is a conservative baseline.
How does inflation affect retirement savings?
Inflation is the hidden tax on savings. $50,000/year needed today becomes ~$104,700/year in 25 years at 3% inflation. The 4% safe withdrawal rule assumes inflation-adjusted withdrawals — you increase the annual withdrawal with CPI each year.
Does a savings account keep up with inflation?
Traditional savings accounts (0.01–0.5% APY) lose badly to inflation. Current HYSAs at 4–5% APY beat it — but rates change. In normal low-rate environments, even HYSAs fell behind. Treasury I-Bonds are designed to match CPI exactly — they adjust every 6 months.
What is the current US inflation rate?
US inflation has been running 2.5-3.5% in 2025-2026, down from the 9% peak in mid-2022. The Federal Reserve targets 2% long-term. The CPI-U is the standard measure published monthly by the BLS.
How does inflation eat into my savings?
If you keep $10,000 in a 0% checking account for 10 years at 3% inflation, that money has the buying power of $7,440 in today's dollars — you have lost 26% of purchasing power. To break even, your savings must earn at least the inflation rate.
How is inflation calculated?
The BLS surveys ~80,000 prices across 200+ categories every month. They compute a weighted average price change vs the prior month and annualize it. The CPI 'basket' includes housing (33%), transportation (18%), food (14%), medical (8%). Core CPI excludes volatile food and energy.
What investment returns beat inflation?
Long-term: stocks (S&P 500 ~10% nominal, ~7% real), real estate (~9% nominal), corporate bonds (~5% nominal). Short-term: money market funds and HYSAs can match inflation when rates are high. TIPS explicitly index to CPI.
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