See how inflation erodes the purchasing power of money over time. Calculate the future cost of goods, the real value of your savings, and what inflation-adjusted returns look like.
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The price of something today — or your current savings.
India's CPI inflation has averaged 5–7% over the last decade. Use 6% for conservative planning.
How many years into the future you want to see the impact.
At 6% inflation, money loses half its purchasing power in approximately 12 years (Rule of 72: 72 ÷ 6 = 12). Any investment earning less than the inflation rate is effectively losing real value.
India's CPI inflation has averaged around 5–7% over the past decade. The RBI targets 4% (with a 2% band on either side). Food inflation can be higher — 8–10% in some years.
If your savings account earns 3.5% and inflation is 6%, your real return is -2.5%. Your money grows in nominal terms but loses purchasing power. This is why investing in equity is essential for long-term wealth.
Divide 72 by the inflation rate to find how many years it takes for prices to double. At 6% inflation: 72 ÷ 6 = 12 years. A ₹100 item today will cost ₹200 in 12 years.
Nominal return is the stated percentage your investment earns. Real return = Nominal return − Inflation rate. An FD at 7% with 6% inflation gives a real return of only 1%.
India CPI inflation has ranged from 4-7% in recent years, with food inflation often higher. The RBI targets 4% inflation (±2%). Use 6-7% as a conservative estimate for long-term financial planning in India.