Inflation Calculator
Calculate future cost of goods with inflation in India. See how inflation erodes purchasing power over 5, 10, 20 years.
Year-wise Impact
| Year | Cost of ₹1,00,000 item | Worth of ₹1,00,000 |
|---|---|---|
| Year 1 | ₹1,06,000 | ₹94,340 |
| Year 2 | ₹1,12,360 | ₹89,000 |
| Year 3 | ₹1,19,102 | ₹83,962 |
| Year 4 | ₹1,26,248 | ₹79,209 |
| Year 5 | ₹1,33,823 | ₹74,726 |
| Year 6 | ₹1,41,852 | ₹70,496 |
| Year 7 | ₹1,50,363 | ₹66,506 |
| Year 8 | ₹1,59,385 | ₹62,741 |
| Year 9 | ₹1,68,948 | ₹59,190 |
| Year 10 | ₹1,79,085 | ₹55,839 |
Frequently Asked Questions
What is inflation?
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. In India, CPI inflation has averaged around 6% over the last decade.
How does inflation affect investments?
Your investment must earn more than the inflation rate to grow in real terms. If your FD earns 7% but inflation is 6%, your real return is only ~1%. Equity and real estate tend to beat inflation long-term.
What is the difference between CPI and WPI?
CPI (Consumer Price Index) measures retail price changes experienced by consumers. WPI (Wholesale Price Index) measures wholesale price changes. RBI targets CPI inflation at 4% (±2%) for monetary policy.
How to protect against inflation?
Invest in assets that historically beat inflation: equity (12-15% CAGR), real estate (8-12%), gold (8-10%). Avoid keeping too much in savings accounts (3-4%) or under the mattress (0%).
What is real return vs nominal return?
Nominal return is the stated return (e.g., 12%). Real return adjusts for inflation: Real Return ≈ Nominal Return - Inflation. So 12% nominal with 6% inflation = ~6% real return.