Inflation Calculator
See what today's money will cost in future — and the real-return hurdle your savings must clear.
Your inputs
long-run average inflation is often around 6% in India — illustrative, not a guarantee.
Common scenarios
What you expect your investment to earn — used for the 'how much to save today' plan. Illustrative, not guaranteed.
Inflation compounds once a year on the prior year's already-higher prices.
Results update live — calculations run in your browser, no signup.
₹2.40 L
The same ₹1.00 L basket costs 2.40× more — you'll need 2.40 times the money to buy what ₹1.00 L buys today.
Assumes a constant 6.0% inflation compounded annually. Real inflation is uneven and varies by item, region and year — treat this as a planning estimate, not a forecast.
What ₹1.00 L buys: today vs in 15 years
Kept as idle cash, the same money fills less of the cart later.
You'd need 2.40× more money — about ₹2.40 L — to fill the same cart in 15 years.
How your money loses value
The real worth of a fixed ₹1.00 L left idle — declining every year inflation runs.
Year 4
₹1.26L
Year 8
₹1.59L
Year 11
₹1.90L
Year 15
₹2.40L
Year-by-year erosion
Rising future cost and the shrinking worth of today's ₹1.00 L at 6.0% inflation, for each of the 15 years.
| Year | Future cost | Worth of cash | Power lost |
|---|---|---|---|
| Today | ₹1.00 L | ₹1.00 L | 0.0% |
| Year 1 | ₹1.06 L | ₹94,340 | 5.7% |
| Year 2 | ₹1.12 L | ₹89,000 | 11.0% |
| Year 3 | ₹1.19 L | ₹83,962 | 16.0% |
| Year 4 | ₹1.26 L | ₹79,209 | 20.8% |
| Year 5 | ₹1.34 L | ₹74,726 | 25.3% |
| Year 6 | ₹1.42 L | ₹70,496 | 29.5% |
The hurdle your savings must clear
To preserve purchasing power, your money has to earn more than inflation — not just more than zero.
At 6.0% inflation, anything costing ₹1,00,000 today will cost ₹2,39,656 in 15 years — a 2.40× rise. Put the other way, ₹1,00,000 left idle will buy only ₹41,727 worth of today's goods, a 58% loss. An investment must return at least 6.0% a year just to stand still; everything above that is real growth.
Break-even return
6.0%
to keep pace
Price multiple
2.40×
over 15 years
Extra cost
₹1.40L
added by inflation
Power lost
58%
on idle cash
Can these returns beat 6.0% inflation?
Typical long-term / current published reference rates against your inflation rate — illustrative, not guarantees.
Equity (Nifty 50)
long-term average
PPF
current govt rate
Bank FD
typical 1–3 yr deposit
Inflation
the hurdle
Cash / savings
typical interest
Cash / savings
-2.8% real
loses to inflation
Bank FD
+0.9% real
beats inflation
PPF
+1.0% real
beats inflation
Equity (Nifty 50)
+5.7% real
beats inflation
Real return ≈ (1 + nominal) ÷ (1 + inflation) − 1. Cash and low-yield savings tend to lag inflation; broad equity has historically outpaced it over long periods. Market-linked returns are projections, not promises — past performance does not guarantee future returns.
Inflation vs salary growth
A ₹1.00 L salary growing at different hike rates — nominal pay vs its real (inflation-adjusted) value at 6.0% inflation.
| Annual hike | Nominal in 15y | Real value | Real change |
|---|---|---|---|
| 3%/yr | ₹1.56 L | ₹65,009 | -35% |
| 5%/yr | ₹2.08 L | ₹86,746 | -13% |
| 7%/yr | ₹2.76 L | ₹1.15 L | +15% |
| 9%/yr | ₹3.64 L | ₹1.52 L | +52% |
A raise only grows your purchasing power if it beats inflation — a 6% hike against 6% inflation leaves you exactly flat in real terms.
How much should you save today
To match the ₹2.40 L future cost, growing at your expected return. Adjust the return under Advanced options.
Save today
₹43,784
at 12.0%
Real return
+5.7%
after 6.0% inflation
Putting aside ₹43,784 today at 12.0% grows into the ₹2.40 L you'll need — far less than ₹2.40 L because your money also compounds while prices rise.
Inflation rate impact comparison
The same ₹1.00 L over 15 years at different inflation rates.
| Rate | Future value | Increase |
|---|---|---|
| 4% | ₹1.80 L | +80% |
| 6% | ₹2.40 L | +140% |
| 8% | ₹3.17 L | +217% |
| 10% | ₹4.18 L | +318% |
Highlighted row matches your rate. A couple of points higher inflation hugely changes the long-run cost.
Future cost of common expenses
At 6.0% inflation, what everyday costs become in 10 and 20 years. Today's figures are illustrative anchors.
| Expense | Today | In 10 years | In 20 years |
|---|---|---|---|
| Monthly groceries | ₹15,000 | ₹26,863 | ₹48,107 |
| School fees (annual) | ₹1.20 L | ₹2.15 L | ₹3.85 L |
| Monthly rent | ₹25,000 | ₹44,771 | ₹80,178 |
| Hospital day (medical) | ₹30,000 | ₹53,725 | ₹96,214 |
| Family dinner out | ₹2,500 | ₹4,477 | ₹8,018 |
| Litre of petrol | ₹105 | ₹188 | ₹337 |
Today's amounts are reference anchors, not a price survey — the multiplier (1.79× at 10y, 3.21× at 20y) is what matters and applies to any starting price.
Inflation in daily life
How ₹1.00 L of spending power climbs as a price tag across the horizon, at 6.0% a year.
Today
₹1.00L
starting price
Year 5
₹1.34L
1.34× today
Year 10
₹1.79L
1.79× today
Year 15
₹2.40L
2.40× today
Each step compounds on the last — the gap between today and the final year is the full inflation premium you have to plan for.
- You'll need 2.40× more money — about ₹2.40 L — to buy the same basket.
- Idle cash loses 58% of its purchasing power over 15 years.
- Your savings must earn more than 6.0% a year just to stand still.
Key insight — you'll need 2.40× more money
At 6.0% inflation, something costing ₹1.00 L today will cost ₹2.40 L in 15 years. Kept idle, that same cash buys only ₹41,727 worth of today's goods — a 58% loss of purchasing power. Your savings need to earn more than 6.0% a year just to hold their value.
Key takeaways
- Inflation rate: 6.0% a year
- Future cost: ₹2.40 L in 15y (2.40×)
- Worth of idle cash later: ₹41,727
- Purchasing power lost: 58%
- Break-even return needed: 6.0%
Beat-inflation strategies
Diversified equity
· beats the hurdleBroad equity / index funds have historically returned ~11–14% over long periods — well above typical inflation, though with volatility.
PPF & long bonds
· roughly keeps paceTax-free PPF (~7.1%) and longer-dated bonds roughly keep pace with moderate inflation while staying low-risk.
Real assets & gold
· partial hedgeProperty and gold are often held as partial inflation hedges, though returns are uneven and illiquid.
Avoid idle cash
· loses to inflationMoney in a current account or under the mattress earns nothing, so it absorbs the full erosion shown here.
Start investing in mutual funds
Open a free account with ICICI Prudential AMC and start an SIP online. ICICI Prudential Mutual Fund, at no extra cost to you.
At 6.0% inflation, ₹1.00 L today needs about ₹2.40 L in 15 years.
Plan the rest of your money life
Turn the inflation hurdle into a plan — a retirement corpus, a monthly SIP, or a deposit.
Future cost = amount × (1 + inflation)years; future worth = amount ÷ (1 + inflation)years. This calculator compounds a single inflation rate over the period you choose. Real inflation is uneven and varies by item, region and year, so treat every figure here as a planning estimate, not a forecast. The reference rates and anchor prices shown are illustrative for context only — actual returns and prices vary and are not guaranteed.
How the inflation impact is calculated
Future cost = P × (1 + i)ⁿ · Worth later = P ÷ (1 + i)ⁿ · Power lost = 1 − 1 ÷ (1 + i)ⁿ
- P
- amount today
- i
- annual inflation rate ÷ 100
- n
- number of years
- (1 + i)ⁿ
- the price multiple over the period
Worked example
With your inputs — ₹1,00,000 at 6.0% inflation for 15 years: the price multiple is (1 + 0.060)15 = 2.40×. So the same basket costs about ₹2.40L later, while that ₹1.00 L left idle is worth only ₹41.7K in today's terms — a 58% loss of purchasing power. This compounds a single inflation rate annually and is a planning projection, not a guarantee — real inflation is uneven and varies by item, region and year.
Most asked inflation questions
Inflation raises the general price of goods and services over time, so the same amount of cash buys less each year. It doesn't reduce the number of rupees you hold — it reduces what those rupees can purchase.
Future cost is what today's basket of goods will cost later — it grows with inflation. Future worth is what today's idle cash will be able to buy later — it shrinks. They are two sides of the same calculation: one multiplies by the inflation factor, the other divides by it.
Your real return is roughly your investment return minus inflation. If an investment earns 9% while inflation runs at 6%, your purchasing power grows by only about 3%. A nominal return below inflation means you're losing ground despite the balance going up.
Historically, assets that earn more than the inflation rate — diversified equity, equity mutual funds, and some real assets — have outpaced it over long periods, while cash and low-yield savings tend to lag. Nothing is guaranteed; this tool only shows the hurdle inflation sets, not how to clear it.
The complete guide to inflation
What inflation really does to your money
Inflation is the steady rise in the price of everyday goods and services. Because prices compound year after year, even a modest rate quietly erodes the value of cash held idle — the longer the horizon, the larger the gap between what your money is worth today and what it will buy later. It doesn't take rupees out of your wallet; it shrinks what each rupee can purchase.
Future cost vs future worth
These are two sides of the same coin. Future cost asks what today's basket will cost later — it grows with inflation. Future worth asks what today's idle cash will be able to buy later — it shrinks. Here, ₹1.00 L at 6.0% inflation becomes a future cost of ₹2.40 L over 15 years, while the same cash left idle is worth only ₹41,727in today's terms.
Why a small rate compounds into a big gap
A 6.0%rate sounds harmless, but it applies on top of last year's already-higher prices, so it compounds. Over 15 years that produces a 2.40× rise in cost and a 58% loss of purchasing power on idle cash. This is exactly why long horizons — retirement, a child's education, a far-off goal — are so sensitive to the inflation assumption you choose.
Beating inflation: the real-return hurdle
To preserve purchasing power, an investment must earn more than inflation, not just more than zero. Your real return is roughly the nominal return minus inflation. Cash and low-yield savings often lag, so they lose ground in real terms. Historically, diversified equity and equity mutual funds have outpaced inflation over long periods — but nothing is guaranteed, and market-linked returns are projections, not promises.
How to use this when planning
Use a realistic long-run inflation assumption — often around 6% in India, though it varies by period and by what you actually spend on — and treat the result as a planning estimate, not a forecast. The main value of this tool is to show the hurdle: it tells you the minimum return your savings must clear to stay level, so you can judge whether a deposit, bond or equity allocation is genuinely growing your wealth or merely keeping up. Confirm specific rates and tax treatment, which change over time, before acting.
Inflation and your salary
A pay rise only grows your real income if it clears inflation. A 6% hike against 6% inflation leaves you exactly flat in purchasing power; anything below means a quiet pay cut in real terms even though the number on your payslip went up. The same logic applies to the future cost of goals — saving the right amount today, invested above the inflation hurdle, is what closes the gap.