What is inflation?
Inflation measures how much the costs of everyday goods and services go up over time and as a result, how much the value of money goes down. For example, in 1960 you could by an average house for around £2,500, while today the average house price is nearly 100 times more expensive. That’s why investing your money can help preserve your long-term spending power.
So if you want to save up for something several years in the future, it might be worth linking your monthly savings above to inflation to give you a more realistic idea of how long it will take you to reach your goal. If your savings goal is shorter-term saving, choose to link your savings to today’s value.