Inflation Calculator

This inflation calculator uses historical CPI-based average inflation rates by decade to adjust dollar values between any two years from 1970 onward. It applies the decade-specific average annual rate for each year in the range: 7.1% for the 1970s, 5.6% for the 1980s, 3.0% for the 1990s, 2.5% for the 2000s, 1.8% for the 2010s, and 4.5% for 2020-2026. For projections beyond 2026, it uses your specified expected inflation rate. The result shows the equivalent purchasing power adjusted for cumulative inflation over the period.

Purchasing power is the amount of goods and services that one unit of currency can buy. As inflation drives prices up over time, each dollar buys less than it did before. For example, $100 in 2000 had roughly the same purchasing power as about $180 in 2026, meaning you would need nearly $180 in 2026 to buy what $100 bought in 2000. This erosion of purchasing power is why long-term financial planning must account for inflation, even at seemingly low rates like 2-3% per year.

US inflation has varied significantly by decade. The 1970s saw the highest average at about 7.1% per year due to oil shocks and wage-price spirals. The 1980s averaged 5.6% as the Federal Reserve aggressively raised interest rates. The 1990s settled to about 3.0%, the 2000s to 2.5%, and the 2010s to just 1.8% during a period of low inflation. The 2020s have averaged roughly 4.5% driven by pandemic-related supply disruptions and fiscal stimulus. Since 1970, the long-term average has been approximately 3.9% per year.

Since 1970, the US dollar has lost approximately 85% of its purchasing power due to cumulative inflation. One dollar in 1970 would have the same buying power as roughly $7.80 or more today. This means something that cost $1 in 1970 would cost about $7.80 in 2026. This dramatic decline illustrates why keeping money in low-interest savings accounts that earn less than the inflation rate actually results in a loss of real wealth over time. Investing in assets that outpace inflation is essential for preserving long-term purchasing power.