See how inflation erodes the purchasing power of your money over time — and how much you need to earn to stay ahead of it.
An inflation calculator shows the effect of rising prices on your money over time. Because the cost of goods and services increases every year, the same ₹100 today will buy less in the future. This tool calculates two key figures: the future value (how much money you will need in the future to have the same purchasing power as today) and the purchasing power (what your current amount will actually be worth in today's rupees).
For Indian savers, understanding inflation is critical: with an average CPI inflation of roughly 5-6% in India, money kept idle in cash loses about half its purchasing power every 12-14 years. This is why financial planners strongly recommend investing in assets that can outpace inflation over the long term.
Future Value = P × (1 + i/100)t | Purchasing Power = P / (1 + i/100)t
Where: P = current amount, i = annual inflation rate (%), t = years. To beat inflation, your investment return must exceed the inflation rate — the difference was historically known as the "real rate of return."
India's Consumer Price Index (CPI) inflation typically fluctuates between 4% and 7%, with the RBI targeting 4% (within a 2-6% band). For long-term planning, assuming 5-6% is prudent. Using a slightly higher rate makes your plan more conservative and resilient.
To beat inflation, invest in assets with returns above the inflation rate. Historically, equity mutual funds and equity-indexed products have delivered 10%+ long-term returns, comfortably beating inflation. Debt instruments such as PPF (which offers an inflation-beating tax-free rate) and some debt funds also help. Keeping large sums in a savings account (3-4% interest) usually loses purchasing power after inflation.
They use the same math, but a future value calculator applies your investment return, while an inflation calculator applies the inflation (price rise) rate. You can combine both: use the inflation calculator to find the future cost of a goal (e.g., a child's education or retirement needs), then use our Lump Sum or SIP calculator to find how much to invest to reach that future amount.