📉 Inflation Calculator
How much is your cash in the bank really worth?
Last updated: March 2026
* This calculator is for educational purposes only and does not constitute financial advice.
With Indian inflation averaging 5-7%, every ₹1,00,000 in a savings account (earning 3-4%) effectively loses ₹2,000-₹3,000 in purchasing power annually. Your money is shrinking in real terms.
That's why FDs alone aren't enough. Smart investing in equity mutual funds, NIFTY 50 index funds, or PPF helps your money grow faster than inflation and preserve its real value.
Enter the amount in your savings account or FD, the inflation rate (6% is India's average), and the period. See the real value of your money and how much purchasing power you've lost.
📊 How does this compare to a Nifty 50?
⚡ Popular Scenarios
FAQ
What is India's inflation rate?
CPI inflation averages 5-7%. ₹100 today = ₹94 purchasing power next year.
Why are FDs not enough?
FDs at 6-7% barely match inflation. After 30% tax, real returns are negative.
How to beat inflation?
Equity mutual funds (12%), PPF (7.1% tax-free), NPS, real estate, or gold.
What about gold?
Gold returns 8-10% in INR. SGBs offer 2.5% interest + gold appreciation.
Is PPF a good inflation hedge?
PPF at 7.1% is tax-free, making the effective post-tax return among the best for risk-free investments. At 6% inflation, PPF gives ~1% real return. It's excellent for the debt portion of your portfolio, but equity exposure is needed for true wealth creation.
How much has Indian inflation been historically?
India's CPI inflation has averaged 6-7% over the last decade, with spikes above 8% in some years. Food inflation often runs higher. This is why ₹1 lakh in a savings account (3.5% interest) loses ₹2,500-3,500 in real value every year.
NPS vs mutual funds for inflation protection?
NPS offers tax benefits (Section 80CCD up to ₹50,000 extra deduction) and equity exposure up to 75%. Equity mutual funds/SIPs have no lock-in and higher equity allocation. Ideal strategy: maximize NPS tax benefit, then invest remaining in direct mutual fund SIPs.
How does this compare to a SIP?
Compare your results to investing in a Nifty 50 at ~12% annually. Use this as a baseline to evaluate your investment decision.
Want to see the power of compound interest? Try the Compound Interest Calculator
📊 Data source: Standard financial models. Prices and data in this article are reviewed and updated semi-annually. Last update: March 2026.
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Created by Amiel Riss | SmartMoney77