How much does inflation really erode your savings? Use official CPI rates (2026)

Why the rate you pick matters more than the math

Every inflation calculator uses the same compound formula. The difference between a useful answer and a fantasy number is almost always the rate you type in. If you assume 2% when the last decade averaged closer to 3%, you will overstate how much your cash is still worth.

OurInflation Calculatornow includes official annual U.S. CPI-U rates from 2016 through 2025, sourced from the Bureau of Labor Statistics. You can tap the latest year, a 5-year average, or a 10-year average as a starting point, then adjust if you want a more conservative scenario.

A quick example: $10,000 over 10 years

Suppose you have $10,000 in a checking account earning no interest. At the 2025 CPI-U rate of 2.6%, that pile still has the same number on the statement — but its purchasing power in today's terms falls to about $7,750 after 10 years of steady inflation. At a 3.5% assumption, you are closer to $7,050. The gap is real money when you are planning a down payment or an emergency fund.

Pair the inflation result with ourCompound Interest Calculatorif part of the money actually earns a return. That shows whether your portfolio is keeping up with prices or quietly falling behind.

What the presets do — and what they do not do

• Presets fill in a historical average or the latest official annual rate — they do not forecast next year.
• The table shows each year's rate and when we last verified the source link.
• You can still enter any rate manually for a stress test (for example 4% for a cautious plan).

For retirement planning, run the same rate through ourRetirement Calculatorafter you see the inflation impact on cash. Inflation and return assumptions belong together, not in separate spreadsheets.