Inflation Calculator 2026
How much has inflation changed the value of money? Calculate purchasing power from 1913 to 2026 using CPI data.
How Inflation Erodes Purchasing Power
Inflation measures the rate at which prices increase over time, reducing what your money can buy. The US Bureau of Labor Statistics tracks this through the Consumer Price Index (CPI).
- 1913: CPI baseline established at 9.9
- 1980: CPI = 82.4 (728% increase from 1913)
- 2000: CPI = 172.2 (1,640% increase from 1913)
- 2022: CPI = 296.8 (peak inflation, 9.1% YoY)
- 2026: CPI ≈ 318 (est. 2.5-3.0% YoY)
Historical Inflation by Decade
| Decade | Avg Annual Rate | Cumulative | $100 Becomes |
|---|---|---|---|
| 1950s | 2.1% | 23% | $81 |
| 1960s | 2.4% | 27% | $79 |
| 1970s | 7.4% | 105% | $49 |
| 1980s | 5.1% | 64% | $61 |
| 1990s | 3.0% | 34% | $75 |
| 2000s | 2.5% | 28% | $78 |
| 2010s | 1.8% | 19% | $84 |
| 2020-2026 | 4.3% | 30% | $77 |
Why Inflation Matters for Your Finances
- Savings erosion: At 3% inflation, $10,000 in a savings account earning 0.5% loses $250/year in purchasing power
- Salary stagnation: A 3% raise with 3% inflation = 0% real wage growth. You need raises above inflation to get ahead
- Investment returns: A 7% stock return minus 3% inflation = 4% real return. Always think in real (after-inflation) terms
- Debt advantage: Fixed-rate debt gets "cheaper" over time — a $2,000 mortgage payment in 2040 will feel like $1,200 in today's dollars
- Retirement planning: At 3% inflation, you need $2.43 at age 75 for every $1 you need at age 65 — plan for higher withdrawals
How to Protect Against Inflation
- I Bonds: Treasury bonds that adjust for inflation — 6.89% rate in 2023, now ~3.5% (rate resets every 6 months). $10K/year max.
- TIPS: Treasury Inflation-Protected Securities — principal adjusts with CPI. No annual limit. Best in brokerage/IRA accounts.
- Real estate: Property values and rents tend to rise with inflation. Mortgages with fixed rates get "cheaper" in real terms.
- Stocks: Historically 7% real returns (after inflation) — the best long-term inflation hedge available to most investors.
- Commodities/Gold: Traditional inflation hedge but volatile. Gold returned ~1% real return over the last 100 years.
- Avoid long-term bonds: 10-30 year bonds lose value when inflation rises. Keep bond durations short (1-5 years).
2026 Inflation Outlook
After peaking at 9.1% in June 2022, inflation has moderated significantly:
- Federal Reserve target: 2% (long-run)
- 2026 projection: 2.5-3.0% (CPI year-over-year)
- Core inflation (ex-food/energy): 2.8-3.2%
- Fed funds rate: 4.25-4.50% (down from 5.25-5.50% peak)
- Risk factors: Tariff policy, energy prices, housing costs, wage growth
Frequently Asked Questions
What is the current inflation rate in 2026?
US inflation (CPI) in 2026 is approximately 2.5-3.0% year-over-year as of June 2026. This is down from the 2022 peak of 9.1% and near the Federal Reserve's 2% target.
How much has the dollar lost since 2000?
Cumulative inflation since 2000 is approximately 80-85%. $100 in 2000 has the same purchasing power as about $185 in 2026. The dollar has lost roughly 46% of its value.
What causes inflation?
Three main causes: (1) Demand-pull — too much money chasing too few goods, (2) Cost-push — rising production costs (wages, materials, energy), (3) Built-in — workers demand higher wages to keep up with prices, creating a cycle.