Inflation & Purchasing Power Calculator
At 3% inflation, your money loses 10% of its value every 3.5 years.
The Silent 10% Tax: Inflation Steals Your Savings
At the historical US average of ~3% inflation, your purchasing power drops by roughly 10% every 3.5 years. Cash sitting in a savings account earning 0.5% is losing ~2.5% per year in real value.
This is why "saving" isn't enough — your money needs to grow faster than inflation just to maintain its value.
Historical Inflation Rates
| Period | Avg. Annual | $100 → After 10yr |
|---|---|---|
| US 2010-2020 | 1.8% | $83.60 purchasing power |
| US 2020-2024 | 5.2% | $60.30 (projected) |
| US long-term avg | 3.0% | $74.40 purchasing power |
| Eurozone avg | 2.0% | $82.00 purchasing power |
| Argentina 2023 | ~140% | Essentially worthless |
| Japan 2000-2020 | 0.2% | $98.00 (near-zero inflation) |
Why Prices "Feel" Like They Rise 10%
Official inflation (~3%) measures a broad basket. But everyday items often rise faster: housing (+5-8%/yr in many cities), healthcare (+5-6%/yr), education (+4-5%/yr). If your daily spending skews toward these categories, your personal inflation rate may be 2-3× the official number.
This is called "shrinkflation" — the price stays the same but the package gets 10% smaller. Same money, less product.
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