Inflation Calculator

An inflation calculator shows you how the purchasing power of money changes over time — and what a dollar from any year in history is actually worth today. Our free calculator uses real Bureau of Labor Statistics CPI-U data from 1913 through 2026 and projects forward to 2100 using an adjustable inflation rate. Switch between Dollar Value Over Time (historical and future comparisons) and Annual Rate Calculator (compound inflation modeling) using the tabs above the calculator.

In 2026, the US CPI-U inflation rate stands at 2.4% — down from the 9.1% peak in June 2022 but still running above the Federal Reserve’s 2.0% PCE target. Understanding inflation is essential for retirement planning, salary negotiations, investment returns, and any financial decision that spans multiple years.

How to Use This Inflation Calculator

Dollar Value Over Time mode: Enter a dollar amount, select a From Year (as early as 1913) and a To Year (up to 2100), and set your assumed future inflation rate for years beyond 2026. Click Calculate to see the equivalent value in the target year, the total cumulative inflation percentage, the average annual rate over that period, and a line chart showing the value trajectory. The purchasing power box explains in plain English what a dollar from the From Year is worth in the To Year.

Annual Rate Calculator mode: Enter a starting amount, an annual inflation rate, and a number of years. The calculator shows the future nominal value of that amount, the total inflation percentage, and how much purchasing power is lost. This mode is useful for modeling scenarios — what happens to your savings if inflation runs at 3% for 20 years? What about 5%?

What Is Inflation?

Inflation is the rate at which the general price level of goods and services rises over time, which means the purchasing power of money falls. When the inflation rate is 2.4%, a basket of goods that cost $100 today will cost $102.40 in one year. Over 30 years at 2.4% annual inflation, that same basket costs $202 — your dollar buys roughly half as much.

The US government measures inflation primarily through two indexes: the Consumer Price Index (CPI), published by the Bureau of Labor Statistics, and the Personal Consumption Expenditures (PCE) price index, published by the Bureau of Economic Analysis. The Federal Reserve uses PCE as its primary inflation benchmark and targets 2.0% annual PCE inflation as consistent with price stability and maximum employment. The CPI and PCE track similar goods but with different methodologies — CPI tends to run slightly higher than PCE historically.

US Inflation History: Key Periods

Understanding historical inflation helps contextualize today’s 2.4% rate and why financial planning must account for inflation over long time horizons.

The 1970s stagflation era — when inflation averaged nearly 9% for a decade — is the most instructive historical warning about persistent inflation. A household that held $100,000 in cash from 1972 to 1982 lost approximately 60% of its purchasing power. The Federal Reserve under Paul Volcker broke the inflation spiral by raising the federal funds rate to 20% in 1981 — deliberately triggering a severe recession to restore price stability.

How Inflation Affects Your Money Over Time

The long-run effect of even moderate inflation is dramatic. At the Fed’s 2.0% target rate, purchasing power halves in approximately 35 years. At the 2.4% current rate, it halves in about 29 years. At 3%, it halves in 24 years.

These figures show what something costs in the future — not what your savings are worth. If your savings earn 0% (sitting in a checking account) and inflation runs at 2.4%, your $100 today only buys $78.89 worth of goods in 10 years. If your savings earn 2.4% annually (a HYSA matching inflation), your purchasing power stays flat. If your investments earn 7% annually, your real purchasing power after 10 years at 2.4% inflation is approximately $138 in today’s dollars.

Inflation and Retirement Planning

Inflation is the silent destroyer of retirement savings. A retiree who needs $60,000 per year in 2026 will need approximately $98,000 per year in 2046 to maintain the same standard of living — assuming 2.4% annual inflation. Over a 30-year retirement, a fixed income that does not adjust for inflation loses more than half its purchasing power.

Social Security benefits include an annual Cost of Living Adjustment (COLA) based on the CPI-W (Consumer Price Index for Urban Wage Earners and Clerical Workers). The 2026 COLA was 2.5%, providing a modest inflation offset for beneficiaries. Traditional pensions rarely include inflation adjustments. 401(k) and IRA balances are invested and theoretically grow with the market — which historically outpaces inflation — but market downturns in early retirement years can permanently impair purchasing power.

Use the inflation calculator above to model what your target retirement income needs to be in future dollars. Enter your current annual expenses as the dollar amount, set From Year to 2026, and set To Year to your expected retirement start date to see the inflation-adjusted target. Use our 401(k) Calculator to model whether your savings rate will meet that target.

What Causes Inflation?

Demand-pull inflation occurs when demand for goods and services exceeds supply — consumers and businesses compete for limited goods, pushing prices up. The 2021–2022 inflation surge was largely demand-pull, driven by $5+ trillion in COVID-era stimulus payments flooding the economy while supply chains were constrained.

Cost-push inflation occurs when production costs rise and businesses pass those costs to consumers. The 1973–1974 oil shock — when OPEC embargoed oil exports to the US, quadrupling crude oil prices — is the classic cost-push inflation example. Energy prices affected the cost of virtually everything.

Monetary inflation occurs when the money supply grows faster than economic output. The equation of exchange (MV = PQ) states that money supply × velocity = price level × output. When M grows without a corresponding increase in Q, prices (P) must rise.

Frequently Asked Questions

What does the inflation calculator use for historical data?

This calculator uses the Consumer Price Index for All Urban Consumers (CPI-U), series CUUR0000SA0, published by the Bureau of Labor Statistics. CPI-U covers approximately 93% of the US population and is the most widely used inflation measure for consumer price comparisons. Annual average index values are used from 1913 through 2026. Note: October 2025 CPI data is unavailable due to a lapse in government appropriations and has been estimated from surrounding months.

What inflation rate is used for future years?

For years beyond 2026, the calculator uses the future inflation rate you set in the input field, defaulting to 2.5% per year. This is consistent with the Federal Reserve’s 2% PCE target plus a small historical premium that CPI tends to run above PCE. You can change this rate to model different scenarios — 1% for optimistic low-inflation futures, 5% for high-inflation stress tests.

What is the current inflation rate in the US?

The current CPI-U inflation rate is 2.4% for the 12 months ending February 2026 (the most recent data available as of this writing). This is down significantly from the peak of 9.1% in June 2022. The Federal Reserve targets 2.0% PCE inflation as consistent with price stability. The February 2026 breakdown shows food +3.1%, energy +0.5%, and core (ex food and energy) +2.5%.

How does inflation affect savings?

Inflation erodes the purchasing power of savings held in low-yield accounts. If your savings account pays 0.5% APY and inflation runs at 2.4%, your real (inflation-adjusted) return is approximately −1.9% per year — your money grows nominally but buys less each year. In 2026, high-yield savings accounts offer 4.0–5.0% APY, which outpaces current inflation and provides a positive real return. Use our Savings Goal Calculator to model savings growth against inflation.

What is the difference between CPI and PCE?

CPI (Consumer Price Index) measures the price change of a fixed basket of goods and services typically purchased by urban consumers. PCE (Personal Consumption Expenditures) measures spending on all goods and services consumed by households, with weights that change dynamically based on actual spending patterns. PCE tends to run 0.3–0.5 percentage points lower than CPI historically because it adjusts for consumer substitution (when beef gets expensive, people buy chicken). The Fed uses PCE as its primary inflation benchmark for this reason.

How do I calculate inflation between two years manually?

The formula is: Inflation % = ((CPI in later year − CPI in earlier year) ÷ CPI in earlier year) × 100. For example, from 2000 to 2026: ((325.3 − 172.2) ÷ 172.2) × 100 = 88.9%. The equivalent dollar amount is: (Amount × CPI in target year) ÷ CPI in base year. For $100 in 2000 to 2026: ($100 × 325.3) ÷ 172.2 = $188.91. The calculator above handles this automatically for any year combination from 1913 to 2100.

What was the highest inflation rate in US history?

The highest sustained inflation period in modern US history was 1979–1981, when the annual CPI-U rate peaked at 13.5% in 1979. The 1970s stagflation decade averaged approximately 7.4% annual inflation from 1973 to 1982. In the 20th century, the worst single-year spike was 1918 at approximately 18%, driven by World War I spending. The recent 2022 peak of 9.1% was the highest since the early 1980s but was brought under control relatively quickly compared to the 1970s episode.

How does the Fed fight inflation?

The Federal Reserve’s primary tool for fighting inflation is the federal funds rate — the overnight interest rate banks charge each other for lending reserves. By raising this rate, the Fed makes borrowing more expensive across the economy, reducing consumer spending and business investment, which cools demand and slows price increases. From March 2022 to July 2023, the Fed raised the federal funds rate from near zero to 5.25–5.50% — the most aggressive tightening cycle in 40 years. By 2026, inflation has returned near the 2% target, and the Fed has begun gradually reducing rates.

Related Calculators

• 401(k) Calculator — Model whether your retirement savings will keep pace with inflation over your career.
• Savings Goal Calculator — Plan savings goals with real interest rates and compare against inflation erosion.
• Investment Return Calculator — Calculate real (inflation-adjusted) investment returns over time.
• Budget Planner Calculator — Build a monthly budget that accounts for rising costs due to inflation.
• Retirement Calculator — Model your retirement income needs in inflation-adjusted future dollars.