📉 Inflation Calculator
Understand exactly how inflation has eroded purchasing power over the years. Convert any dollar amount between any years from 1913 to 2026 using historical CPI data, or project future purchasing power.
Understand exactly how inflation has eroded purchasing power over the years. Convert any dollar amount between any years from 1913 to 2026 using historical CPI data, or project future purchasing power.
Inflation is the rate at which the general price level of goods and services rises over time, causing each dollar to buy less. The U.S. Federal Reserve targets 2% annual inflation as ideal for economic growth.
Divide 72 by the inflation rate to estimate how many years until prices double:
Cash in a savings account earning 0.5% while inflation runs at 3% means your real purchasing power shrinks by ~2.5% per year. Diversified investments in stocks have historically returned 7–10% annually, well above inflation.
Historical annual CPI inflation data helps contextualize today's economic environment:
| Period | Avg Annual Inflation | Key Event | $100 Became |
|---|---|---|---|
| 1970s | 7.09% | Oil Crisis, Stagflation | $195 by 1980 |
| 1980s | 5.10% | Volcker Shock, Recovery | $165 by 1990 |
| 1990s | 3.00% | Dot-com boom, stability | $135 by 2000 |
| 2000s | 2.56% | Housing bubble, 2008 crisis | $129 by 2010 |
| 2010s | 1.76% | Post-recession low inflation | $119 by 2020 |
| 2020–2024 | 4.90% | COVID-19 supply shocks | $127 by 2025 |
| 2025–2026 (est.) | 2.8% | Stabilization period | ~$106 by 2027 |
Inflation quietly erodes purchasing power. These examples use a 3% average annual rate.
An item costing $1,000 today, with prices rising 3% per year for 10 years.
Result: Future cost ≈ $1,343.92 — about $344 more than today.
How much $50,000 saved under the mattress would be worth in real terms after 20 years of 3% inflation.
Result: Real value ≈ $27,684 — it loses nearly $22,316 of buying power.
A weekly grocery bill of $100 today, projected 5 years out at 3% inflation.
Result: Expected cost ≈ $115.93.
Money sitting in cash loses purchasing power as prices rise. At 3% inflation, $10,000 buys about $7,400 worth of goods in 10 years unless it earns interest.
Mainly more demand than supply, rising production costs, and growth in the money supply. Central banks target about 2% as healthy.
Hold assets that tend to outpace it — stocks, real estate, I-bonds and TIPS — rather than large idle cash balances.