Inflation Calculator

Inflation is the rate at which prices rise over time, so the same rupee buys less each year. This calculator answers two questions: how much will something that costs a given amount today cost in future, and how much is a future sum worth in today's money. Use it to set realistic targets for goals like education, a house, or retirement.

How to use this calculator

1. Enter the current cost of the expense or the amount of money (for example, ₹10 lakh).
2. Enter the expected inflation rate per year in percent.
3. Enter the number of years.
4. Read the future cost of today's expense and the present value (today's purchasing power) of that amount received after the same number of years.

Try a few inflation rates. A difference of 2 percentage points becomes large over 15-20 years.

Formula

Future cost = C × (1 + i)^n
Today's value of a future amount = A ÷ (1 + i)^n

• C = current cost
• A = amount you will receive or hold in n years
• i = annual inflation rate ÷ 100
• n = number of years

The second formula is the first in reverse: it tells you how much purchasing power an amount fixed in rupees will have after inflation.

Worked example

Future cost. A college course costs ₹10 lakh today. With education inflation of 6% a year, what will it cost in 15 years?

• (1.06)^15 ≈ 2.3966
• Future cost = 10,00,000 × 2.3966 ≈ ₹23.97 lakh

Purchasing power. You expect to have ₹1 crore in 20 years. At 6% inflation, what is that worth today?

• (1.06)^20 ≈ 3.2071
• Today's value = 1,00,00,000 ÷ 3.2071 ≈ ₹31.18 lakh

The ₹1 crore will buy only about what ₹31 lakh buys today. That is why long-term goals must be set in future rupees, and why savings that earn less than inflation lose real value.

Things to keep in mind

• RBI's target. The government has notified a CPI inflation target of 4%, with a band of 2% to 6%, for April 2026 to March 2031. RBI's Monetary Policy Committee aims to keep inflation inside this band.
• Latest reading. As of October 2026, CPI inflation for September 2026 was 5.54% (released by MoSPI on 12 October 2026, on the revised CPI series with base year 2024), up from 4.83% in August, driven largely by food prices. RBI projects CPI inflation of 5.2% for FY 2026-27. Inflation varies year to year; the calculator assumes one constant rate.
• Goal-specific inflation. School and college fees, and medical costs, have often risen faster than headline CPI. Use a higher rate for those goals.
• Real returns. An FD at 7% with 5.5% inflation earns a real return of only about 1.4% before tax, and less after tax. Compare investment returns against inflation, not against zero.
• Taxes are not included. Interest and capital gains are taxed, which further reduces real returns.
• Planning tools. For retirement, combine inflation with expected returns in the retirement calculator. For a monthly investment towards an inflated goal, use the SIP calculator.

The results are estimates for planning. Actual inflation will differ from any single assumed rate.