Inflation Calculator

Last updated: May 2026

Amount

GBP

Annual inflation rate

Time period

years

Year	Value in today's money
1	£975.61
5	£883.85
10	£781.20
20	£610.27
30	£476.74

Common items

Item	Today	In 10 years
Weekly shop	£150	£192
New car	£25,000	£32,002
House	£300,000	£384,025

About this calculator

The Inflation Calculator estimates how inflation changes purchasing power over time. It can show what today’s money may buy in the future, how much future money is needed to match today’s spending, and the difference between nominal and real returns. It is useful for savings goals, salary planning, retirement planning, and understanding why cash values can be misleading over long periods.

Inflation formulas

Inflation compounds over time in a similar way to interest, increasing future costs and reducing purchasing power.

Future cost = today’s cost x (1 + inflation rate)^years
Real return = (1 + nominal return) / (1 + inflation rate) - 1

Worked example

Future cost

Input: GBP 1,000, inflation 2.5%, 10 years

Calculation: 1,000 x 1.025^10

Result: Future cost is about GBP 1,280.

Limitations

This calculator provides an estimate only and is not financial or tax advice.

Actual inflation varies by household and spending category.
Historical averages do not predict future inflation.

Frequently asked questions

What is purchasing power?

It is what money can buy after price changes are considered.

What is a real return?

A real return is the investment return after inflation is removed.

Is CPI the same for everyone?

No. CPI is an average index, while personal inflation depends on what you buy.

Related calculators

Compound Interest Calculator
Present Value Calculator
Interest Rate Calculator
Savings Goal Calculator

What is inflation?

Inflation is the rate at which prices rise over time. When inflation is positive, the same amount of money buys less in the future than it buys today.

CPI vs RPI in the UK

CPI is the UK's main consumer inflation measure and is widely used for economic reporting. RPI is an older measure that often runs higher and is still used in some contracts, pensions, and rail fare calculations.

How inflation affects savings

Savings only grow in real terms if the interest rate beats inflation after tax. A 4% savings rate with 5% inflation still loses purchasing power, even though the cash balance rises.

Real vs nominal interest rates

Nominal return is the headline growth rate. Real return is the return after inflation. It shows whether your money is actually buying more goods and services over time.