$1 in 1971 is worth $7.32 today.
The value of $1 from 1971 to 2022
$1 in 1971 has the purchasing power of about $7.32 today, a $6.32 increase in 51 years. Between 1971 and today, the dollar experienced an average annual inflation rate of 3.98%, resulting in a cumulative price increase of 631.55%.
According to the Bureau of Labor Statistics consumer price index, today's prices are several times higher than the average price since 1971.
In 1971, the inflation rate was 4.29%. Inflation is now 8.52% higher than it was last year. If this figure holds true, $1 today will be worth $9.52 next year in purchasing power.
Inflation from 1971 to 2022
| Summary | Value |
|---|---|
| Cumulative price change (from 1971 to today) | 631.55% |
| Average inflation rate (from 1971 to today) | 3.98% |
| Converted amount | $7.32 |
| Price Difference | $6.32 |
| CPI in 1971 | 40.5 |
| CPI in 2022 | 296.276 |
| Inflation in 1971 | 4.29% |
| Inflation in 2022 | 8.52% |
| $1 in 1971 | $7.32 in 2022 |
Buying power of $1 in 1971
If you had $1 in your hand in 1971, its adjusted value for inflation today would be $7.32. Put another way, you would need $7.32 to beat the rising inflation. When $1 becomes equivalent to $7.32 over time, the "real value" of a single US dollar decreases. In other words, a dollar will pay for fewer items at the store.
This effect explains how inflation gradually erodes the value of a dollar. By calculating the value in 1971 dollars, it's evident how $1 loses its worth over 51 years.
Dollar inflation for $1 from 1971 to 2022
The below tabular column shows the effect of inflation on $1 in the year 1971 to the year 1971.
| Year | Dollar Value | Inflation Rate |
|---|---|---|
| 1971 | 1 | 4.29% |
| 1972 | 1.08 | 3.27% |
| 1973 | 1.16 | 6.18% |
| 1974 | 1.25 | 11.05% |
| 1975 | 1.34 | 9.13% |
| 1976 | 1.44 | 5.76% |
| 1977 | 1.55 | 6.50% |
| 1978 | 1.67 | 7.59% |
| 1979 | 1.86 | 11.35% |
| 1980 | 2.11 | 13.50% |
| 1981 | 2.33 | 10.32% |
| 1982 | 2.48 | 6.16% |
| 1983 | 2.55 | 3.21% |
| 1984 | 2.66 | 4.32% |
| 1985 | 2.76 | 3.56% |
| 1986 | 2.81 | 1.86% |
| 1987 | 2.91 | 3.65% |
| 1988 | 3.03 | 4.14% |
| 1989 | 3.18 | 4.82% |
| 1990 | 3.35 | 5.40% |
| 1991 | 3.49 | 4.21% |
| 1992 | 3.6 | 3.01% |
| 1993 | 3.71 | 2.99% |
| 1994 | 3.8 | 2.56% |
| 1995 | 3.91 | 2.83% |
| 1996 | 4.02 | 2.95% |
| 1997 | 4.12 | 2.29% |
| 1998 | 4.18 | 1.56% |
| 1999 | 4.27 | 2.21% |
| 2000 | 4.42 | 3.36% |
| 2001 | 4.54 | 2.85% |
| 2002 | 4.61 | 1.58% |
| 2003 | 4.72 | 2.28% |
| 2004 | 4.84 | 2.66% |
| 2005 | 5.01 | 3.39% |
| 2006 | 5.17 | 3.23% |
| 2007 | 5.32 | 2.85% |
| 2008 | 5.52 | 3.84% |
| 2009 | 5.5 | -0.36% |
| 2010 | 5.59 | 1.64% |
| 2011 | 5.77 | 3.16% |
| 2012 | 5.89 | 2.07% |
| 2013 | 5.98 | 1.46% |
| 2014 | 6.07 | 1.62% |
| 2015 | 6.08 | 0.12% |
| 2016 | 6.16 | 1.26% |
| 2017 | 6.29 | 2.13% |
| 2018 | 6.44 | 2.49% |
| 2019 | 6.56 | 1.76% |
| 2020 | 6.64 | 1.23% |
| 2021 | 6.95 | 4.70% |
| 2022 | 7.61 | 8.52% |
Conversion of 1971 dollars to today's price
Based on the 631.55% change in prices, the following 1971 amounts are shown in today's dollars:
| Initial value | Today value |
|---|---|
| $1 dollar in 1971 | $7.32 dollars today |
| $5 dollars in 1971 | $36.58 dollars today |
| $10 dollars in 1971 | $73.15 dollars today |
| $50 dollars in 1971 | $365.77 dollars today |
| $100 dollars in 1971 | $731.55 dollars today |
| $500 dollars in 1971 | $3657.73 dollars today |
| $1,000 dollars in 1971 | $7315.46 dollars today |
| $5,000 dollars in 1971 | $36577.28 dollars today |
| $10,000 dollars in 1971 | $73154.57 dollars today |
| $50,000 dollars in 1971 | $365772.84 dollars today |
| $100,000 dollars in 1971 | $731545.68 dollars today |
| $500,000 dollars in 1971 | $3657728.4 dollars today |
| $1,000,000 dollars in 1971 | $7315456.79 dollars today |
How to calculate the inflated value of $1 in 1971
To calculate the change in value between 1971 and today, we use the following inflation rate formula:
CPI Today / CPI in 1971 x USD Value in 1971 = Current USD Value
By plugging the values into the formula above, we get:
296.276/ 40.5 x $1 = $7.32
To buy the same product that you could buy for $1 in 1971, you would need $7.32 in 2022.
To calculate the cumulative or total inflation rate in the past 51 years between 1971 and 2022, we use the following formula:
CPI in 2022 - CPI in 1971 / CPI in 1971 x 100 = Cumulative Inflation Rate
By inserting the values to this equation, we get:
( 296.276 - 40.5 / 40.5) x 100 = 631.55%
Alternate method to calculate today's value of money after inflation - Using compound interest formula
Given that money changes over time due to inflation, which acts as compound interest, we can use the following formula:
FV = PV (1+i/100)^n
where,
- FV = Future value
- PV = Present value
- i: Average interest rate (inflation)
- n: Number of times the interest is compounded (i.e. # of years)
The future value in this case represents the amount obtained after applying the inflation rate to our initial value. In other words, it indicates how much $1 is worth today. We have 51 years between 2022 and 1971. The average inflation rate was 3.9790656987529%.
Plugging in the values into the formula, we get:
1 (1+ % 3.98/ 100 ) ^ 51 = $7.32