The quietest tax has a calculator now.
Set an amount, a rate, and a horizon — see what the same shopping will cost, what your idle cash will still buy, and why "safe" money parked below inflation is not actually safe.
At 6% inflation, what costs Rs 50,000 today will cost Rs 89,542 in 10 years. The same Rs 50,000 left as idle cash will buy only Rs 27,920 worth — which is why savings need a return at least equal to inflation just to stand still.
| Year | Purchasing power of your cash | Cost of the same basket |
|---|---|---|
| 1 | Rs 47,170 | Rs 53,000 |
| 2 | Rs 44,500 | Rs 56,180 |
| 3 | Rs 41,981 | Rs 59,551 |
| 4 | Rs 39,605 | Rs 63,124 |
| 5 | Rs 37,363 | Rs 66,911 |
| 6 | Rs 35,248 | Rs 70,926 |
| 7 | Rs 33,253 | Rs 75,182 |
| 8 | Rs 31,371 | Rs 79,692 |
| 9 | Rs 29,595 | Rs 84,474 |
| 10 | Rs 27,920 | Rs 89,542 |
Year-by-year table
| Year | Cost of the basket | Purchasing power |
|---|---|---|
| 1 | Rs 53,000 | Rs 47,170 |
| 2 | Rs 56,180 | Rs 44,500 |
| 3 | Rs 59,551 | Rs 41,981 |
| 4 | Rs 63,124 | Rs 39,605 |
| 5 | Rs 66,911 | Rs 37,363 |
| 6 | Rs 70,926 | Rs 35,248 |
| 7 | Rs 75,182 | Rs 33,253 |
| 8 | Rs 79,692 | Rs 31,371 |
| 9 | Rs 84,474 | Rs 29,595 |
| 10 | Rs 89,542 | Rs 27,920 |
Compound-inflation math at a constant rate you choose. Nepal's actual CPI moves year to year and your personal inflation (rent, school fees, health) can run hotter than the headline — test a range rather than one number.
How the math works
Inflation compounds exactly like interest, just against you. Future cost = amount × (1+i)^years; purchasing power = amount ÷ (1+i)^years. The chart draws both curves at once — the basket climbing, your cash sliding — and the gap between them at any year is what waiting costs. The rule of 72 gives the doubling time in your head: 72 ÷ rate ≈ years for prices to double.
Using it honestly
The rate slider is the honest part: headline CPI is an average of a basket you do not exactly buy. Rent, school fees, and medical costs — the heavyweights of a Kathmandu household budget — have their own trajectories. Run the calculator at the headline rate for a floor, then at your personal rate for the truth, and size emergency funds and retirement targets off the second number.
Frequently asked
- How does the inflation calculation work?
- Two mirror formulas. Future cost multiplies today's price by (1 + inflation)^years — what the same basket will cost later. Purchasing power divides today's amount by the same factor — what your unmoved cash will still buy. At 6% for 12 years the factor is almost exactly 2: prices double, and idle cash buys half.
- What inflation rate should I use for Nepal?
- The calculator deliberately makes you choose, because one number hides the story. Nepal's headline CPI moves year to year, and your personal inflation — rent in Kathmandu, school fees, health costs — can run well above it. A practical approach: run your plan at a moderate rate and again a couple of points higher, and make sure it survives both. The linked purchasing-power and grocery-basket guides carry the researched Nepali price history.
- What is the rule of 72?
- A quick mental shortcut: divide 72 by the inflation rate to get the approximate years for prices to double. At 6%, that is about 12 years; at 9%, about 8. It is an approximation of the exact compound math this calculator runs, useful for sanity-checking a result in your head.
- Why does inflation matter for my savings account or FD?
- Because the real return is the interest rate minus inflation. A deposit paying less than inflation is losing purchasing power every year even as the balance grows — politely, safely, and with a 6% TDS haircut on the interest to boot. Any long-term money needs a return at least at inflation just to tread water, which is the case for the investing options in the linked guides.
- How does inflation change retirement planning?
- It is the whole problem. Expenses of Rs 60,000 a month today are not Rs 60,000 a month in twenty years — at 6% they are roughly Rs 1.9 lakh. A retirement corpus must be sized against those inflated expenses and must keep growing through retirement itself. The retirement-corpus guide linked below runs that math end to end for Nepal.
The numbers behind the sliders
A calculator gives you the shape of the decision; these guides give you the current Nepali numbers to feed it.
- Inflation vs your salary: the purchasing-power mathWhat Nepali CPI has done to a static salary, with researched numbers.
- The Kathmandu grocery basket, 2083 vs 2080Real shelf prices over three years — personal inflation, measured.
- Is Rs 2 crore enough to retire in Nepal?Corpus math with inflation doing its worst over 30 years.
- How big should an emergency fund be in Kathmandu?The months-of-expenses target, priced at current Kathmandu costs.
Import your bank statements, watch the actual monthly surplus, and check it against the number you just slid to. Free, built for Nepali banks and wallets.
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