Inflation impact calculator
Inflation is the quietest force in personal finance: nothing falls, yet everything shrinks. See what a sum of money buys after years of inflation — and what return cash needs just to stand still.
Your numbers
What it's really worth
Buying power if it just sits
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Buying power at your interest rate
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Erosion if idle
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Cost of living multiplier
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Both lines show real (inflation-adjusted) buying power: grey is cash earning nothing, teal is cash at your interest rate. Illustration only — actual inflation varies year to year and by what you personally buy.
Assumptions and method
- Buying power divides by (1 + inflation) each year; the with-interest line compounds your rate, then deflates the same way. The "multiplier" shows how much prices rise overall — what £1 of today's costs becomes.
- The Bank of England targets 2% inflation; the long-run UK average is higher, and the early-2020s spike shows how wrong "about 2%" can briefly be. Try 2%, 3% and 5% — the spread is the point.
- This is why emergency funds live in cash (stability matters more than growth) but decades-long money usually doesn't — see investing basics and the compound growth calculator for the other side of the equation.
Reminder: this tool is general education, not a forecast of inflation or a recommendation to hold or move any money. For decisions, consult an FCA-authorised adviser — our toolkit shows how to find one.