Formula and example
How it is calculated
Future price = current price × (1+inflation)ʸ; current purchasing power = amount / (1+inflation)ʸ, with inflation as a decimal
Worked example
Current costs of €1,000 become €1,343.92 after ten years at 3% annual inflation.
Things to check
- No official inflation time series is used. The entered rate is your assumption, rather than a forecast.
- Use one currency consistently. Examples use euros; the calculation works with any currency.