Inflation calculator: future value UK

See what a sum of money today will actually be able to buy in the future once prices have risen, and work out the reverse: how much you'd need at that future date to match what your money buys today.

Figures for the 2026/27 tax year. Last reviewed 28-09-2026.

How this calculator works

Inflation is the rate prices rise each year. It doesn't touch the number on your bank statement, but it quietly erodes what that number can actually buy. This calculator runs the maths both ways: it shows what your chosen amount will be worth in real terms after a number of years of inflation, and separately what future amount you'd need to have the same spending power as today.

Both figures come from the same compounding calculation, just applied in opposite directions. If prices rise by your chosen rate every year, an amount today divides down to its future purchasing power, and the same amount multiplies up to the future sum that matches it pound for pound in what it can buy.

A worked example

Take £10,000 sitting in cash today, and assume inflation runs at 2.5% a year for 20 years — a reasonable long-run planning assumption, in line with the Bank of England's 2% target plus a small margin. In today's purchasing power, that £10,000 will be worth roughly £6,073 in 20 years' time. Prices will have risen enough that the same basket of goods that costs £10,000 today would cost about £16,470 by then.

Neither figure is a prediction of what will happen to your specific money — this calculator doesn't add any investment growth, it only strips out or adds back the effect of rising prices. If the money is invested rather than held as cash, see the compound interest calculator, which layers growth on top of this same inflation adjustment.

What the two results actually mean

"Purchasing power" answers: if I leave this amount untouched, what will it actually be able to buy later? It's the number to look at if you're worried about cash sitting in a low-interest account losing value in real terms.

"Amount needed to match today's money" answers the opposite question: if I want a future sum that feels like today's amount does now, how big does it need to be? This is the more useful figure for setting a savings or income target years ahead — a salary, a pension income, or a savings goal expressed in today's terms needs to be scaled up by this much just to stand still, before any real growth in living standards is added on top.

Common mistakes with inflation

The most common one is comparing a future number directly against a target set in today's terms without adjusting either of them — a pension pot or salary figure quoted for a date decades away can look impressive until you realise it needs to be considerably larger just to match what a smaller number buys today.

The second is assuming a single flat inflation rate is guaranteed. Prices don't rise smoothly: the UK saw inflation below 1% for stretches of the 2010s and above 10% in 2022-23. Treat any single-rate inflation projection, including this one, as an illustration of the mechanics rather than a forecast, and revisit the assumption periodically.

The third is forgetting that inflation applies to costs as well as incomes. If your income keeps pace with inflation but a specific cost (care fees and private school fees are common examples) rises faster than general prices, this calculator's single rate will understate the gap for that particular cost.

How this fits with saving and retirement planning

Every calculator in this suite that spans several years — from the compound interest calculator to how much do I need to retire — uses the same idea: showing a "real terms" figure in today's money alongside the raw future ("nominal") figure, so a projection years or decades away isn't accidentally read as more valuable than it will actually be. This calculator isolates that adjustment on its own, without any growth or contributions mixed in, which makes it a useful quick reference on its own or a sense check for the assumption you're using elsewhere.

Frequently asked questions

What inflation rate should I use?

There's no single correct answer, which is why the rate is editable above. The Bank of England targets 2% CPI inflation over the long run; many long-term financial plans use something a little above that, around 2.5-3%, to be cautious. UK CPI has averaged roughly 2.8% a year over the last 30 years (1995-2025), though this is an illustrative long-run average, not a forecast — actual inflation has ranged from under 1% to over 10% within that period.

Is this the same as compound interest?

The maths is the same compounding formula, but the meaning is opposite. Compound interest describes money growing because it's invested. Inflation describes prices rising, which shrinks what a static amount of money can buy. If your money is invested rather than sitting in cash, use the compound interest calculator to model growth, then compare the result against this calculator's inflation-adjusted figure to see the real (after-inflation) return.

Why does the future amount needed seem so much higher than the purchasing power figure?

They're answering different questions from opposite ends of the same calculation, so they diverge the more years and the higher the inflation rate you choose. Purchasing power tells you what a fixed amount shrinks to. Amount needed tells you how large a future sum must grow to avoid shrinking at all. The gap between them is exactly the effect of inflation over that period.

Does this calculator account for interest or investment growth?

No — deliberately not. This calculator isolates the effect of inflation alone, so you can see it clearly without it being mixed in with investment returns. If you want a projection that includes both saving growth and inflation together, see the compound interest calculator or how long will my pension last, which both show real (today's money) and nominal figures side by side.

How often does inflation actually change?

The Office for National Statistics publishes the UK Consumer Prices Index (CPI) every month, and it moves constantly in response to energy costs, wages, global supply chains and other factors. A single annual rate, as used in this calculator, is a simplification useful for long-term planning, not a description of month-to-month reality.