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Inflation Calculator

See how purchasing power changes with inflation over time.

Short answer

Future value = PV × (1 + i)ⁿ. Bank of England's inflation target is 2% — we use that as a default. Past inflation has been higher (avg 3-4% over decades).

Calculation

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Direction

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Calculation method, coverage and version

Inputs used
Amount, Number of years, Annual inflation rate, Direction.
Calculation approach
The calculator applies the rules and assumptions described in “How it works” to the values you enter. Rounding can cause small differences from an official or provider calculation.
Coverage
Mortgages & Money. UK nations, tax treatment, local rules and provider criteria can differ; check the official sources shown below before acting.
Content version
No page-specific review date is currently published. Treat the result as indicative and verify current rules independently.
Not included unless explicitly requested: personal circumstances not entered, provider discretion, future rule changes, professional fees and case-specific exceptions. Read the full calculator methodology.

Primary sources and official verification

Use these official sources to verify current rules before acting. Coverage and dates can differ across England, Scotland, Wales and Northern Ireland.

See the sitewide source policy.

How it works

Compound inflation: future value = present × (1 + rate)^years. Past value reverses the formula.

Worked example

£100 in 10 years at 2.5%: £128.01. So £100 today buys what £128.01 will need to buy in 2036.

Who should use this

  • •Retirement planners
  • •Anyone comparing salaries across decades
  • •Forecasting savings goals

Common mistakes

  • ×Using a single rate for long historical periods (1970s inflation was 20%+)
  • ×Forgetting that wage growth often offsets inflation

Frequently asked questions

What inflation rate should I use?▾

Bank of England targets 2%. UK long-run average is closer to 2.5-3%. For caution, use 3%.

Related calculators

Compound Interest →Future Value →Retirement Savings →