Inflation Calculator
Calculate the future value of money accounting for inflation, or find today's value of a past amount.
How inflation erodes wealth
Inflation is the rate at which the general level of prices rises, reducing purchasing power. India's average CPI inflation has been around 5–7% over the last decade.
Frequently asked questions
What is the average inflation rate in India?
India's Consumer Price Index (CPI) inflation has averaged around 5–7% over 2015–2025. Food inflation tends to be higher (8–10% in some years). The RBI targets 4% inflation (±2% band). For long-term financial planning, using 6% is a reasonable assumption.
How does inflation affect my savings?
If your savings earn less than the inflation rate, you are effectively losing money in real terms. A Fixed Deposit earning 6.5% when inflation is 6% gives only 0.5% real return (before tax). With 30% tax on interest, your post-tax FD return is ~4.55%, a real loss of ~1.45%.
What investments beat inflation in India?
Historically, equities (Nifty 50) have returned 12–14% CAGR over long periods, well above inflation. Real estate in metros, gold, and equity mutual funds are considered inflation-beating assets. PPF at 7.1% slightly beats 6% inflation, tax-free.
What is the "Rule of 70" for inflation?
Divide 70 by the inflation rate to find how many years it takes for prices to double. At 6% inflation, prices double every ~11.7 years. At 7%, every 10 years. This helps understand how quickly your savings can lose purchasing power.
How does inflation impact retirement planning?
This is critical. If you plan to retire on ₹50,000/month in today's money but retire in 20 years, you will actually need ₹1,60,357/month at 6% inflation. A retirement corpus of ₹1.5Cr that seems adequate today may only sustain ₹30,000/month in real terms 20 years from now.