How to use it
- Use the formula below with your own figures.
The formula
Compare a budget across places using cost indexes.
Worked example
A salary can feel very different between cities.
Frequently asked questions
What drives differences?
Housing, tax and everyday prices.
Is it precise?
It's a broad guide, not a quote.
Tips
- Compare money across years in real terms.
- Hold assets that grow at or above inflation.
- Cash quietly loses value when prices rise.
Key terms
- CPI
- A price index for a basket of goods.
- Real return
- Return after inflation.
- Purchasing power
- What a sum can actually buy.