Inflation Calculator: Measure Your Purchasing Power
Understand the real-world value of your money over time.
Inflation is the rate at which the general level of prices for goods and services rises, and subsequently, purchasing power is falling. Our Inflation Calculator allows you to compare the value of a dollar (or pound) from the past to its equivalent value today, helping you understand historical costs and plan for future price increases.
Inflation Calculator
Calculate the buying power of money over time
See how inflation affects your money
How Inflation is Measured
To calculate these values, we utilize official government data from the Consumer Price Index (CPI).
The Consumer Price Index (CPI)
The CPI represents the average change over time in the prices paid by urban consumers for a “market basket” of consumer goods and services, including:
- Housing & Utilities
- Food & Beverages
- Transportation & Gas
- Medical Care & Education
Why Inflation Matters for Your Family
On familyhealthcalc.com, we highlight how inflation affects your financial health in three major ways:
- Savings Erosion: If your savings account interest rate is lower than the inflation rate, your money is actually losing value every year.
- Wage Growth: To maintain your standard of living, your salary must increase at the same rate as inflation. If you haven’t had a raise in two years, you have effectively taken a pay cut.
- Future Planning: When using our Retirement Calculator, it is vital to account for inflation. $5,000 a month in retirement might feel like a lot today, but in 30 years, it may only buy $2,500 worth of goods.