$500 in 1972 is worth $3543.97 today.
The value of $500 from 1972 to 2022
$500 in 1972 has the purchasing power of about $3543.97 today, a $3043.97 increase in 50 years. Between 1972 and today, the dollar experienced an average annual inflation rate of 3.99%, resulting in a cumulative price increase of 608.79%.
According to the Bureau of Labor Statistics consumer price index, today's prices are several times higher than the average price since 1972.
In 1972, the inflation rate was 3.27%. Inflation is now 8.52% higher than it was last year. If this figure holds true, $500 today will be worth $4760 next year in purchasing power.
Inflation from 1972 to 2022
| Summary | Value |
|---|---|
| Cumulative price change (from 1972 to today) | 608.79% |
| Average inflation rate (from 1972 to today) | 3.99% |
| Converted amount | $3543.97 |
| Price Difference | $3043.97 |
| CPI in 1972 | 41.8 |
| CPI in 2022 | 296.276 |
| Inflation in 1972 | 3.27% |
| Inflation in 2022 | 8.52% |
| $500 in 1972 | $3543.97 in 2022 |
Buying power of $500 in 1972
If you had $500 in your hand in 1972, its adjusted value for inflation today would be $3543.97. Put another way, you would need $3543.97 to beat the rising inflation. When $500 becomes equivalent to $3543.97 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 1972 dollars, it's evident how $500 loses its worth over 50 years.
Dollar inflation for $500 from 1972 to 2022
The below tabular column shows the effect of inflation on $500 in the year 1972 to the year 1972.
| Year | Dollar Value | Inflation Rate |
|---|---|---|
| 1972 | 500 | 3.27% |
| 1973 | 538.15 | 6.18% |
| 1974 | 579.22 | 11.05% |
| 1975 | 623.42 | 9.13% |
| 1976 | 670.99 | 5.76% |
| 1977 | 722.2 | 6.50% |
| 1978 | 777.31 | 7.59% |
| 1979 | 864.79 | 11.35% |
| 1980 | 981.96 | 13.50% |
| 1981 | 1083.45 | 10.32% |
| 1982 | 1149.88 | 6.16% |
| 1983 | 1186.82 | 3.21% |
| 1984 | 1237.85 | 4.32% |
| 1985 | 1281.74 | 3.56% |
| 1986 | 1306.07 | 1.86% |
| 1987 | 1353.93 | 3.65% |
| 1988 | 1409.14 | 4.14% |
| 1989 | 1477.16 | 4.82% |
| 1990 | 1556.9 | 5.40% |
| 1991 | 1622.83 | 4.21% |
| 1992 | 1671.99 | 3.01% |
| 1993 | 1721.34 | 2.99% |
| 1994 | 1766.22 | 2.56% |
| 1995 | 1815.77 | 2.83% |
| 1996 | 1869 | 2.95% |
| 1997 | 1912.69 | 2.29% |
| 1998 | 1942.38 | 1.56% |
| 1999 | 1984.88 | 2.21% |
| 2000 | 2051.9 | 3.36% |
| 2001 | 2109.89 | 2.85% |
| 2002 | 2143.36 | 1.58% |
| 2003 | 2192.01 | 2.28% |
| 2004 | 2250.7 | 2.66% |
| 2005 | 2327.06 | 3.39% |
| 2006 | 2402.13 | 3.23% |
| 2007 | 2470.65 | 2.85% |
| 2008 | 2565.5 | 3.84% |
| 2009 | 2556.38 | -0.36% |
| 2010 | 2598.31 | 1.64% |
| 2011 | 2680.33 | 3.16% |
| 2012 | 2735.8 | 2.07% |
| 2013 | 2775.87 | 1.46% |
| 2014 | 2820.9 | 1.62% |
| 2015 | 2824.25 | 0.12% |
| 2016 | 2859.88 | 1.26% |
| 2017 | 2920.97 | 2.13% |
| 2018 | 2992.24 | 2.49% |
| 2019 | 3046.46 | 1.76% |
| 2020 | 3084.04 | 1.23% |
| 2021 | 3228.92 | 4.70% |
| 2022 | 3534.06 | 8.52% |
Conversion of 1972 dollars to today's price
Based on the 608.79% change in prices, the following 1972 amounts are shown in today's dollars:
| Initial value | Today value |
|---|---|
| $1 dollar in 1972 | $7.09 dollars today |
| $5 dollars in 1972 | $35.44 dollars today |
| $10 dollars in 1972 | $70.88 dollars today |
| $50 dollars in 1972 | $354.4 dollars today |
| $100 dollars in 1972 | $708.79 dollars today |
| $500 dollars in 1972 | $3543.97 dollars today |
| $1,000 dollars in 1972 | $7087.94 dollars today |
| $5,000 dollars in 1972 | $35439.71 dollars today |
| $10,000 dollars in 1972 | $70879.43 dollars today |
| $50,000 dollars in 1972 | $354397.13 dollars today |
| $100,000 dollars in 1972 | $708794.26 dollars today |
| $500,000 dollars in 1972 | $3543971.29 dollars today |
| $1,000,000 dollars in 1972 | $7087942.58 dollars today |
How to calculate the inflated value of $500 in 1972
To calculate the change in value between 1972 and today, we use the following inflation rate formula:
CPI Today / CPI in 1972 x USD Value in 1972 = Current USD Value
By plugging the values into the formula above, we get:
296.276/ 41.8 x $500 = $3543.97
To buy the same product that you could buy for $500 in 1972, you would need $3543.97 in 2022.
To calculate the cumulative or total inflation rate in the past 50 years between 1972 and 2022, we use the following formula:
CPI in 2022 - CPI in 1972 / CPI in 1972 x 100 = Cumulative Inflation Rate
By inserting the values to this equation, we get:
( 296.276 - 41.8 / 41.8) x 100 = 608.79%
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 $500 is worth today. We have 50 years between 2022 and 1972. The average inflation rate was 3.9945078116676%.
Plugging in the values into the formula, we get:
500 (1+ % 3.99/ 100 ) ^ 50 = $3543.97