Session Ready
Exercise

Forecast growing expenses due to inflation

You will also assume your monthly expenses will rise by an average of 2.5% per year due to inflation. This will lead to higher cost of living over time, paying for the same expenses each year but at a higher price. Luckily, your salary is growing faster than inflation, which means you should have more money going into savings each month.

The monthly_expenses and forecast_months variables from the previous exercise are available.

Instructions
100 XP
  • Set the annual inflation rate to 2.5%.
  • Derive the equivalent monthly inflation rate.
  • Forecast cumulative inflation growth over time.
  • Derive your monthly expenses by adjusting for growth due to inflation.