What inflation does to money
Inflation does not take money out of your account — it quietly takes things out of your basket. The number on the note stays the same while the number on the price tag climbs, so the same amount buys less each year. This calculator shows both sides of that: what prices become, and what your money shrinks to.
Formula
Future cost = amount × (1 + rate)^yearsToday’s money is later worth = amount ÷ (1 + rate)^years
Worked example
At 8% a year, something that costs 100,000 today costs 215,892 in ten years. Turn it around: 100,000 left in a drawer buys what 46,319 buys today. More than half the value is gone, without a single rupee leaving the drawer.
How to use the inflation calculator
- Enter an amount — a salary, a savings balance, the price of something you plan to buy.
- Enter a rate. Use the long-run average for your country rather than this month's headline figure.
- Enter the years, then read both lines: what it will cost, and what your money will be worth.
Using it for planning
- Savings that earn less than inflation lose value every year, however healthy the balance looks.
- Plan long goals — education, retirement, a house — in future prices, not today's. The gap over twenty years is enormous.
- A salary rise below inflation is a pay cut in real terms. Compare the percentage, not the number.
Frequently asked questions
How do you calculate inflation over several years?
Multiply the amount by (1 + rate) once for each year — that is, amount × (1 + rate)^years. Inflation compounds, so ten years at 8% is a 116% rise, not 80%.
What inflation rate should I use?
For planning, use your country’s long-run average rather than the latest month. Bangladesh has run close to 8–9% in recent years; many countries sit nearer 2–3%.
How much do I need to earn to beat inflation?
Your return after tax has to be above the inflation rate. At 8% inflation, a 6% deposit is losing about 2% of its real value every year.