The inflation rate in your hands

By Ian Pollock
Personal finance reporter, BBC News

The Office for National Statistics (ONS) has launched its personal inflation calculator giving users the chance to work out if the goods they are buying are going up in price faster or slower than the national average.

Visit its website and you can punch in your own spending estimates under a number of headings such as food, clothes and transport.

ONS personal inflation calculator - lets you put the figures in

You can also add in where you live, and how big your mortgage payments and rent are each month.

The results make for interesting reading, especially when you remember that the UK's average inflation rate is 3.9% when measured by the Retail Prices Index (RPI). Meanwhile, the Consumer Prices Index (CPI) stands at 2.7%.

The BBC has used ONS figures to work out a number of scenarios and rates.

SINGLE PERSON, NOT YET RETIRED

He or she lives in London, spending £1,167 a month on goods and services.

No young children at home but add in mortgage repayments, council tax, insurance bills and the cost of housing repairs, running a car and a holiday abroad, and this household's own inflation rate is currently 5.1%.

RETIRED SINGLE PERSON, BUT NOT DEPENDENT ON STATE PENSION

This pensioner lives in London too.

He or she spends £711 a month on the necessities of life but nothing on tobacco or children.

The mortgage has been paid off and there is no rent to pay, however council tax and utilities are still expensive, along with house repairs and running a car.

This person likes a decent holiday abroad, and has spent a lot on furnishings and electrical goods in past three years.

Their personal inflation rate is identical to the RPI national average of 3.9%

TWO ADULTS WITH CHILDREN

This family in the South West spends £2,617 a month on goods and services, with most going on childcare, transport and food.

In addition a large mortgage is still being paid off, while running a car or two is expensive and they like to have a nice foreign holiday each year.

Their inflation rate is way above the national average at 6%.

RETIRED COUPLE, LIVING MAINLY ON A STATE PENSION

This pensioner couple live in the North West.

Regular monthly spending of £1,036 covers everyday items like food, clothes, heating and travel.

They spend nothing on child care or alcohol, and they don't run a car so are free of burdensome overheads like insurance and repairs.

Living in a council house means there are no house-repair costs, but they still pay rent and have a modest holiday in the UK each year.

Their personal inflation rate comes in at 5.2%

A COUPLE WHO HAVE NOT RETIRED YET

These two live in Northern Ireland.

They spend £2,252 on regular monthly living expenses though nothing on child care or tobacco.

They have the usual mortgage payments to pay and face the usual overheads for council tax and their house, car and holidays.

They enjoy a personal inflation rate of 5.3%.

Methodology used

ONS personal inflation calculator - the results are often very different

The BBC chose spending patterns that were based on households included in the government's annual survey of family spending.

The last survey was for 2004-05 and examined in depth the spending of 7,000 households in the UK.

The figures used were for the average family in each group, rather than those in the poorest or richest categories.

Launching the calculator, the ONS said that the reason that some people thought they endured a different inflation rate from the national average was not just because their shopping and spending habits were different from the average.

According to its analysis, the ONS said that price of goods bought most often increase more quickly than the "big ticket" items they buy least often.

"The fact that large increases in prices are encountered more often than falls or modest rises can lead people to believe that inflation is higher than official figures show," said the ONS.