Inflation Calculator

What is Inflation?

Inflation is the rate at which the general level of prices for goods and services rises, causing purchasing power to fall. A dollar today will buy less in the future due to inflation.

How This Calculator Works

This calculator uses the compound interest formula to adjust money values for inflation:

Future Value = Present Value × (1 + inflation rate)^years

Historical US Inflation Rates

• 1960s-1970s: 2-6% average
• 1980s: 5-10% (high inflation period)
• 1990s-2000s: 2-3% average
• 2010s: 1-2% average (low inflation)
• 2020s: 2-8% (varied due to pandemic)
• Long-term average: ~3% per year

Use Cases

• Compare prices across different time periods
• Understand purchasing power changes
• Plan for retirement savings
• Evaluate historical salaries and wages
• Analyze investment returns in real terms
• Calculate cost of living adjustments

Examples

• $100 in 2000 = ~$175 in 2024 (3% inflation)
• $50,000 salary in 1990 = ~$115,000 in 2024
• $1 in 1950 = ~$12 in 2024

Important Notes

• This calculator uses a constant inflation rate for simplicity
• Actual inflation varies year by year
• Different goods inflate at different rates
• For precise historical data, use official CPI (Consumer Price Index) data
• Results are estimates and may not reflect actual purchasing power changes

Tips

• Use 3% as a general long-term average for US inflation
• Adjust the rate based on the specific time period
• Consider using official CPI data for more accuracy
• Remember that inflation affects different sectors differently