Personal Inflation Calculator
The news says inflation is 4%. But if you pay rent and drive a car, your reality is likely much worse. Calculate your TRUE inflation rate.
Why 'Official' Inflation Often Feels Wrong
The official Consumer Price Index (CPI) is an average based on a standard 'basket of goods' for the average urban consumer. But you aren't an average. You have a specific life. If you commute 50 miles a day, gas prices affect you 5x more than a remote worker. If you eat vegan, egg prices don't matter to you. This calculator fixes that weighting error by letting you define YOUR basket.
Historical Context: US Inflation (2020-2025)
We are living through one of the most volatile economic periods in decades. Understanding the recent history helps explain why prices feel so high today, even if the 'rate' is coming down.
| Year | Official Inflation Rate | What Happened? |
|---|---|---|
| 2020 | 1.4% | Pandemic lockdowns collapsed demand. |
| 2021 | 7.0% | Supply chain snarls meets stimulus money. |
| 2022 | 9.1% (Peak) | Post-COVID surge + War in Ukraine energy shock. |
| 2023 | 3.4% | Fed raises rates aggressively to cool economy. |
| 2024 | 2.9% | Gradual cooling, but prices remain permanently higher. |
| 2025 | 2.7% (Est) | Stabilization, but Housing/Services remain sticky. |
The 'Hidden' Inflation: Shrinkflation & Skimpflation
Companies often hide price increases by shrinking package sizes (Shrinkflation) or reducing service quality (Skimpflation). Determining your personal rate helps you see through these tricks. If you're buying the same $5 box of cereal but getting 10% less, your personal inflation on that item is actually +10%.
Sector Breakdown: Where Your Money Goes (2026 Forecast)
Different parts of the economy are moving at different speeds. In 2026, we see a divergence:
| Sector | Est. Inflation | Impact on You |
|---|---|---|
| Housing (+44% of CPI) | +5-7% | Renters and new buyers hit hardest relative to owners. |
| Services & Care | +7% | Labor shortages drive up costs for childcare, haircuts, and dining. |
| Food & Groceries | +3% | Stabilizing, but high labor costs keep restaurant prices high. |
| Tech & Goods | -2% | Deflationary. TVs, phones, and toys are actually getting cheaper. |
| Energy | +4% | Volatile. Green transition costs vs. oil supply shifts. |
How to LOWER Your Personal Inflation
- Energy Efficiency: Since energy costs are volatile, cutting consumption (insulation, smart thermostats) permanently lowers your exposure to this risk.
- Tech Deflation Arbitration: Buying refurbished tech or waiting a few months for prices to drop takes advantage of the deflation in the tech sector.
- Service Substitution: With 'Service-flation' at +7%, doing things yourself (cooking, minor repairs, lawn care) saves significantly more money now than it did 5 years ago.
- I-Bonds & TIPS: Consider Treasury Inflation-Protected Securities (TIPS) or Series I Savings Bonds which are government-backed assets explicitly designed to match inflation.
Najczęściej zadawane pytania (FAQ)
Q:How is Personal Inflation calculated?
We take your spending percentages (e.g., 40% on Rent) and multiply them by the sector-specific inflation rates. The official CPI largely ignores your specific mix, which is why your 'personal CPI' is often higher.
Q:Why is Housing inflation so high?
Housing represents over 40% of the official CPI basket. High interest rates have made mortgages expensive, and a lack of supply keeps rents high. If you own your home with a fixed-rate mortgage, your personal housing inflation might be near 0%, significantly lowering your overall rate compared to a renter.
Q:What does 'Real Purchasing Power' mean?
It adjusts your nominal salary for your personal inflation. If you earn $50,000 but your personal inflation is 10%, your 'Real' purchasing power drops to roughly $45,454—meaning you can buy 10% fewer goods than before.
Q:Is the official inflation rate fake?
No, but it's an average of 330 million people. It includes retirees who own homes and 22-year-olds who rent in NYC. It can't possibly accurately represent both. VerCalc's Personal Inflation Calculator solves this by custom-weighting the basket to YOU.
Q:What is the Rule of 72 for Inflation?
The Rule of 72 helps estimate how long it takes for prices to double. Divide 72 by the inflation rate. At 3% inflation, prices double in 24 years. At 9% inflation (like 2022), prices would double in just 8 years.