Example 1: what a sum today is worth in the future
| Direction | Amount today → purchasing power in future |
|---|---|
| Amount today | €20,000.00 |
| Inflation rate (example assumption) | 2.5% p.a. |
| Period | 25 years |
| Future purchasing power | €10,787.81 |
|---|---|
| Purchasing-power loss | €9,212.19 |
| Loss as a percentage | 46.06% |
| Needed later for today's purchasing power | €37,078.88 |
At 2.5% inflation, €20,000.00 in 25 years is worth only about €10,787.81 in today's money (€20,000.00 / 1.025^25) — a loss of €9,212.19, or 46.06%. To buy the same as €20,000.00 does today, you would need about €37,078.88 then (€20,000.00 × 1.025^25). The 2.5% is an example assumption.