$5 in 1983 is worth $14.87 today.
The value of $5 from 1983 to 2022
$5 in 1983 has the purchasing power of about $14.87 today, a $9.87 increase in 39 years. Between 1983 and today, the dollar experienced an average annual inflation rate of 2.83%, resulting in a cumulative price increase of 197.47%.
According to the Bureau of Labor Statistics consumer price index, today's prices are several times higher than the average price since 1983.
In 1983, the inflation rate was 13.55%. Inflation is now 3.21% higher than it was last year. If this figure holds true, $5 today will be worth $21.05 next year in purchasing power.
Inflation from 1983 to 2022
| Summary | Value |
|---|---|
| Cumulative price change (from 1983 to today) | 197.47% |
| Average inflation rate (from 1983 to today) | 2.83% |
| Converted amount | $14.87 |
| Price Difference | $9.87 |
| CPI in 1983 | 99.6 |
| CPI in 2022 | 296.276 |
| Inflation in 1983 | 13.55% |
| Inflation in 2022 | 3.21% |
| $5 in 1983 | $14.87 in 2022 |
Buying power of $5 in 1983
If you had $5 in your hand in 1983, its adjusted value for inflation today would be $14.87. Put another way, you would need $14.87 to beat the rising inflation. When $5 becomes equivalent to $14.87 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 1983 dollars, it's evident how $5 loses its worth over 39 years.
Dollar inflation for $5 from 1983 to 2022
The below tabular column shows the effect of inflation on $5 in the year 1983 to the year 1983.
| Year | Dollar Value | Inflation Rate |
|---|---|---|
| 1983 | 5 | 13.55% |
| 1984 | 5.22 | 4.32% |
| 1985 | 5.4 | 3.56% |
| 1986 | 5.5 | 1.86% |
| 1987 | 5.7 | 3.65% |
| 1988 | 5.94 | 4.14% |
| 1989 | 6.22 | 4.82% |
| 1990 | 6.56 | 5.40% |
| 1991 | 6.84 | 4.21% |
| 1992 | 7.04 | 3.01% |
| 1993 | 7.25 | 2.99% |
| 1994 | 7.44 | 2.56% |
| 1995 | 7.65 | 2.83% |
| 1996 | 7.87 | 2.95% |
| 1997 | 8.06 | 2.29% |
| 1998 | 8.18 | 1.56% |
| 1999 | 8.36 | 2.21% |
| 2000 | 8.64 | 3.36% |
| 2001 | 8.89 | 2.85% |
| 2002 | 9.03 | 1.58% |
| 2003 | 9.23 | 2.28% |
| 2004 | 9.48 | 2.66% |
| 2005 | 9.8 | 3.39% |
| 2006 | 10.12 | 3.23% |
| 2007 | 10.41 | 2.85% |
| 2008 | 10.81 | 3.84% |
| 2009 | 10.77 | -0.36% |
| 2010 | 10.95 | 1.64% |
| 2011 | 11.29 | 3.16% |
| 2012 | 11.53 | 2.07% |
| 2013 | 11.69 | 1.46% |
| 2014 | 11.88 | 1.62% |
| 2015 | 11.9 | 0.12% |
| 2016 | 12.05 | 1.26% |
| 2017 | 12.31 | 2.13% |
| 2018 | 12.61 | 2.49% |
| 2019 | 12.83 | 1.76% |
| 2020 | 12.99 | 1.23% |
| 2021 | 13.6 | 4.70% |
| 2022 | 14.89 | 8.52% |
Conversion of 1983 dollars to today's price
Based on the 197.47% change in prices, the following 1983 amounts are shown in today's dollars:
| Initial value | Today value |
|---|---|
| $1 dollar in 1983 | $2.97 dollars today |
| $5 dollars in 1983 | $14.87 dollars today |
| $10 dollars in 1983 | $29.75 dollars today |
| $50 dollars in 1983 | $148.73 dollars today |
| $100 dollars in 1983 | $297.47 dollars today |
| $500 dollars in 1983 | $1487.33 dollars today |
| $1,000 dollars in 1983 | $2974.66 dollars today |
| $5,000 dollars in 1983 | $14873.29 dollars today |
| $10,000 dollars in 1983 | $29746.59 dollars today |
| $50,000 dollars in 1983 | $148732.93 dollars today |
| $100,000 dollars in 1983 | $297465.86 dollars today |
| $500,000 dollars in 1983 | $1487329.32 dollars today |
| $1,000,000 dollars in 1983 | $2974658.63 dollars today |
How to calculate the inflated value of $5 in 1983
To calculate the change in value between 1983 and today, we use the following inflation rate formula:
CPI Today / CPI in 1983 x USD Value in 1983 = Current USD Value
By plugging the values into the formula above, we get:
296.276/ 99.6 x $5 = $14.87
To buy the same product that you could buy for $5 in 1983, you would need $14.87 in 2022.
To calculate the cumulative or total inflation rate in the past 39 years between 1983 and 2022, we use the following formula:
CPI in 2022 - CPI in 1983 / CPI in 1983 x 100 = Cumulative Inflation Rate
By inserting the values to this equation, we get:
( 296.276 - 99.6 / 99.6) x 100 = 197.47%
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 $5 is worth today. We have 39 years between 2022 and 1983. The average inflation rate was 2.8346356567702%.
Plugging in the values into the formula, we get:
5 (1+ % 2.83/ 100 ) ^ 39 = $14.87