Understanding Inflation and How It Erodes Your Savings

Inflation is the gradual rise in prices over time. It's why a movie ticket or a plate of food costs far more today than it did 20 years ago — and why cash sitting idle loses value.

The hidden cost of holding cash

If inflation is 6% a year, something that costs ₹100 today will cost about ₹106 next year. Put another way, ₹100 kept under your mattress will only buy about ₹94 worth of goods a year later. Over decades, the effect is dramatic.

Why it matters for saving

To truly grow your wealth, your savings need to earn more than inflation. A return of 6% when inflation is 6% means your money isn't actually growing in real terms.

See the impact

Our Inflation Calculator shows how prices rise and how much your money will be worth in future. To grow ahead of inflation, model returns with the Compound Interest Calculator and SIP Calculator.