Inflation could hold your cash back when prices rise higher than the interest on your savings. The actual amount you've saved will go up, but you might not be able to buy as much with it over time.
The value of investments can fall as well as rise, and you may not get back the full amount you invest.
You should continue to hold cash for your short term needs.
Looking to save for the future? Savings accounts are dependable, predictable and easy to access - good for something you need next year or a more immediate emergency. But if you're looking to grow some of your money over the longer term, typically five years or more, investing could deliver a better return and keep the value of your cash above inflation. It's worth remembering, though, that the value of investments can fall as well as rise.
Take a better look at how inflation could hit your savings…
This calculator uses historic data to help give a realistic forecast of inflation over the longer term. Simply input an amount for something you might be saving towards and we will show you the impact that inflation could have on the spending power of your savings.
| Your savings with interest | Cost of goods after inflation | Impact of inflation on your savings | |
|---|---|---|---|
| After 5 years | £ | £ | -£ |
| After 10 years | £ | £ | -£ |
Based on 5 year average interest rate of 1.48% p.a. (January 2019 - December 2023, Bank of England base rate) and inflation of 3.94% (January 2019 - December 2023, CPI inflation data from Office for National Statistics).
We update the calculator in mid-January when the ONS publishes its annual inflation figure for the previous year.
Past performance is not an indicator of future performance and should not be relied on as such.
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