Inflation Impact on Savings Calculator

A savings account with a positive interest rate can still leave you worse off if inflation rises faster than the rate. This hidden loss — often called the inflation tax on savers — eroded the purchasing power of millions of Americans during periods of high inflation when savings rates lagged CPI. This calculator applies the Fisher equation to compare your savings rate to an assumed inflation rate, computing both the nominal future value of your account (the dollar total) and the real value (what that dollar total can actually buy in today's money). The gap between these two figures reveals whether you are genuinely growing your wealth or merely treading water — or falling behind. Enter your current savings balance, your account APY, the expected inflation rate, and a time horizon to see the full picture.

Real rate = (1 + savings rate) ÷ (1 + inflation rate) − 1. This is the Fisher equation, which correctly accounts for the compounding interaction between the savings rate and inflation — it is more accurate than the common approximation of simply subtracting inflation from the nominal rate. Nominal value = Savings × (1 + savings rate)^years shows the raw dollar total. Real value = Savings × (1 + real rate)^years shows what that dollar total is worth in today's purchasing power. A negative real rate means inflation is outpacing interest, so the real value will be lower than the starting balance. Purchasing power change = Real value − starting balance, which is positive for real growth and negative for real loss.