Purchasing power
If inflation averages 6% per year, ₹1,00,000 today would not have the same purchasing power several years from now. The exact future purchasing power depends on the actual inflation experienced.
A simple illustration
For illustration, if a household expense is ₹30,000 per month today and prices rise by an assumed 6% annually, the future equivalent expense can be substantially higher.
Why inflation matters for planning
Investment and retirement planning should consider not only how much money you accumulate, but also what that money may be able to purchase in the future.
Inflation-adjusted thinking
A useful planning exercise is to convert today's target expense into a future amount using an assumed inflation rate and number of years.
Use the inflation calculator
Enter the current amount, assumed inflation rate and time period to see the estimated future amount.