Advisory Tool

Inflation Calculator

Calculate purchasing power adjustments and future values under inflation.

Inflation & Purchasing Power Loss Calculator

Calculate the future inflated cost of goods and purchasing power depreciation over time under expected annual inflation rates.

Future Inflated Budget Formula

          Future Cost = Current Cost × (1 + Inflation Rate / 100)^Years
        

Computes future nominal budget needed to buy equivalent goods and services based on annual inflation rate compounding.

What is Inflation and How it Destroys Cash Value

Inflation measures general price increases of goods and services over time. Uninvested idle cash sitting in savings accounts loses purchasing power constantly.

Real Rate of Return vs Nominal Rate of Return

Real return equals nominal investment return minus inflation rate. If your fund earns 9% return while inflation is 6%, your real wealth growth is 3%.

Investing in Inflation-Beating Asset Classes

Equities, mutual funds, real estate, and gold historically beat retail CPI inflation over long periods, preserving long-term purchasing power.

Frequently Asked Questions (FAQ)

What is the average retail inflation rate in India?

Retail CPI inflation in India historically averages between 5% and 7% per annum.

How does inflation affect retirement planning?

Inflation raises future living expenses. A ₹50,000 monthly expense today requires ₹1.6 Lakhs per month in 20 years at 6% inflation.

Why is keeping large cash in savings accounts harmful?

Savings accounts pay 2.5%-3.5% interest, while inflation runs at 6%. Real cash purchasing power depreciates by 3% each year.