What might today’s money buy after several years of inflation?
Purchasing power later
$32,093
Tip. Long cash holdings need a reason. This chart shows what the reason is costing.
Explore the numbers
Start with a scenario, then read the response curve to see which input actually moves the answer.
Example 1
Cash earmarked for a purchase in five years, where the erosion is modest.
Purchasing power later
$43,130
Example 2
The same cash left for fifteen years, where the loss becomes hard to ignore.
Purchasing power later
$32,093
Example 3
A worse decade than the long-run average, which is the case worth planning against.
Purchasing power later
$24,051
Sweeps years from half to one and a half times your value, holding everything else fixed.
Response curve
Purchasing power later
$32,093
Shows how inflation erodes a fixed pile of cash, and how much you would need later to buy the same basket of goods. It makes the quiet cost of holding too much cash visible.
Future purchasing power = amount ÷ (1 + inflation)^years
Long-run US CPI has often landed near 2 to 3%. Run a 4 or 5% case too, because the decades that hurt are not the average ones.
No. An emergency fund and money for near-term goals belong in cash, and the certainty is worth the erosion. The question this answers is whether you are holding far more than those two purposes need.
It offsets part of the loss. If your account pays 4% and inflation runs 3%, you are roughly holding even before tax. Use the APY savings growth calculator alongside this one.
No. They are educational estimates based on the inputs and assumptions on this page. Confirm important decisions with a qualified professional and your own documents.
The questions people usually ask next.