Future Inflation Calculator

How to Use the Future Inflation Calculator

The Future Inflation Calculator is a handy tool designed to help you estimate the future value of your money considering the expected annual inflation rate. This step-by-step guide will walk you through how to fill in the input fields and interpret the results.

Step 1: Enter the Current Amount

Start by locating the input field labeled Current Amount ($). Here, you should enter the present value that you wish to assess. Make sure that this value is a positive number and at least 0.01. This field is mandatory, so it cannot be left blank.

Step 2: Enter the Expected Annual Inflation Rate

Next, input the Expected Annual Inflation Rate (%). This is the rate at which you expect prices to increase annually. Enter a number between 0.01 and 100. The input should be in percentage form and has a precision requirement with increments of 0.1. This field is also required.

Step 3: Specify the Number of Years

In the field labeled Number of Years, specify the period over which you want to calculate the future value. Enter any whole number between 1 and 100. This number represents the timeframe you are considering for inflation calculations. Remember, this field is required, and precision is up to a year.

Step 4: Choose the Compounding Frequency

The next step is to select a Compounding Frequency from the dropdown menu. This represents how often the interest (inflation) will be applied to the amount. You can choose from Annually, Semi-annually, Quarterly, or Monthly. This selection is crucial as it influences how the returns are computed.

Step 5: Reviewing the Result Fields

After filling in all the input fields, the calculator will display several result fields:

• Future Value: This result shows the value of your initial amount after accounting for inflation over the specified period. It’s formatted as currency in USD with two decimal places.
• Total Increase: This value indicates the absolute increase in your current amount. It’s calculated by subtracting the original amount from the future value and is also formatted in USD.
• Percentage Increase: It represents the percentage growth of your current amount over the timeframe. This is displayed as a percentage with two decimal places.
• Average Yearly Increase: This is the average increase in value per year over the entire timeframe. It’s shown in USD and provides a yearly perspective on growth, with the format including a suffix “/year”.

By following these steps, you can effectively use the Future Inflation Calculator to assess how inflation might impact your financial plans over a specific period. Each result field helps you understand different aspects of the inflationary effect on your initial value.