Inflation Calculator — Real Value of Money

How it works

• Real value = amount ÷ (1 + inflation)^years.
• Real return = (1 + nominal return) ÷ (1 + inflation) − 1 (Fisher equation).
• If your deposit rate is below inflation, your money loses purchasing power even with interest.

FAQ

How much will ₩100M be worth in 20 years?

At 2.5% inflation, about ₩61M in today's money.

Worked example

Example: with 2.5% inflation, ₩100 million today is worth about ₩61.0 million in today's money after 20 years — a 39% loss of purchasing power. To keep the same lifestyle you would need about ₩163.9 million.

If you invest at 4% a year, you will have about ₩219.1 million in 20 years, worth about ₩133.7 million in today's money. The real return is (1.04 ÷ 1.025) − 1 ≈ 1.46%.

Small differences add up: at 3.5% inflation instead of 2.5%, ₩100 million keeps only about ₩50.3 million of purchasing power after 20 years. When planning retirement or a child's education, test a range of inflation rates rather than a single number, and remember that rent, tuition and medical costs often rise faster than the average.

Common mistakes

• Subtracting inflation from the return (4% − 2.5% = 1.5%) is only an approximation; divide instead.
• Use after-tax returns. Korean interest and dividends are taxed at 15.4%.
• The consumer price index is an average. Rent, education and healthcare may rise faster for you.
• The Bank of Korea's inflation target is 2%, but actual inflation varies from year to year.
• Past inflation is not a forecast; use a few scenarios.

Explanation checked on 2026-10-30 · Spotted an outdated value? Tell us