$1 in 1997 is worth $1.85 today.
The value of $1 from 1997 to 2022
$1 in 1997 has the purchasing power of about $1.85 today, a $0.85 increase in 25 years. Between 1997 and today, the dollar experienced an average annual inflation rate of 2.48%, resulting in a cumulative price increase of 84.6%.
According to the Bureau of Labor Statistics consumer price index, today's prices are several times higher than the average price since 1997.
In 1997, the inflation rate was 13.55%. Inflation is now 2.34% higher than it was last year. If this figure holds true, $1 today will be worth $3.34 next year in purchasing power.
Inflation from 1997 to 2022
| Summary | Value |
|---|---|
| Cumulative price change (from 1997 to today) | 84.6% |
| Average inflation rate (from 1997 to today) | 2.48% |
| Converted amount | $1.85 |
| Price Difference | $0.85 |
| CPI in 1997 | 160.5 |
| CPI in 2022 | 296.276 |
| Inflation in 1997 | 13.55% |
| Inflation in 2022 | 2.34% |
| $1 in 1997 | $1.85 in 2022 |
Buying power of $1 in 1997
If you had $1 in your hand in 1997, its adjusted value for inflation today would be $1.85. Put another way, you would need $1.85 to beat the rising inflation. When $1 becomes equivalent to $1.85 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 1997 dollars, it's evident how $1 loses its worth over 25 years.
Dollar inflation for $1 from 1997 to 2022
The below tabular column shows the effect of inflation on $1 in the year 1997 to the year 1997.
| Year | Dollar Value | Inflation Rate |
|---|---|---|
| 1997 | 1 | 13.55% |
| 1998 | 1.02 | 1.56% |
| 1999 | 1.04 | 2.21% |
| 2000 | 1.07 | 3.36% |
| 2001 | 1.1 | 2.85% |
| 2002 | 1.12 | 1.58% |
| 2003 | 1.15 | 2.28% |
| 2004 | 1.18 | 2.66% |
| 2005 | 1.22 | 3.39% |
| 2006 | 1.26 | 3.23% |
| 2007 | 1.29 | 2.85% |
| 2008 | 1.34 | 3.84% |
| 2009 | 1.34 | -0.36% |
| 2010 | 1.36 | 1.64% |
| 2011 | 1.4 | 3.16% |
| 2012 | 1.43 | 2.07% |
| 2013 | 1.45 | 1.46% |
| 2014 | 1.47 | 1.62% |
| 2015 | 1.48 | 0.12% |
| 2016 | 1.5 | 1.26% |
| 2017 | 1.53 | 2.13% |
| 2018 | 1.56 | 2.49% |
| 2019 | 1.59 | 1.76% |
| 2020 | 1.61 | 1.23% |
| 2021 | 1.69 | 4.70% |
| 2022 | 1.85 | 8.52% |
Conversion of 1997 dollars to today's price
Based on the 84.6% change in prices, the following 1997 amounts are shown in today's dollars:
| Initial value | Today value |
|---|---|
| $1 dollar in 1997 | $1.85 dollars today |
| $5 dollars in 1997 | $9.23 dollars today |
| $10 dollars in 1997 | $18.46 dollars today |
| $50 dollars in 1997 | $92.3 dollars today |
| $100 dollars in 1997 | $184.6 dollars today |
| $500 dollars in 1997 | $922.98 dollars today |
| $1,000 dollars in 1997 | $1845.96 dollars today |
| $5,000 dollars in 1997 | $9229.78 dollars today |
| $10,000 dollars in 1997 | $18459.56 dollars today |
| $50,000 dollars in 1997 | $92297.82 dollars today |
| $100,000 dollars in 1997 | $184595.64 dollars today |
| $500,000 dollars in 1997 | $922978.19 dollars today |
| $1,000,000 dollars in 1997 | $1845956.39 dollars today |
How to calculate the inflated value of $1 in 1997
To calculate the change in value between 1997 and today, we use the following inflation rate formula:
CPI Today / CPI in 1997 x USD Value in 1997 = Current USD Value
By plugging the values into the formula above, we get:
296.276/ 160.5 x $1 = $1.85
To buy the same product that you could buy for $1 in 1997, you would need $1.85 in 2022.
To calculate the cumulative or total inflation rate in the past 25 years between 1997 and 2022, we use the following formula:
CPI in 2022 - CPI in 1997 / CPI in 1997 x 100 = Cumulative Inflation Rate
By inserting the values to this equation, we get:
( 296.276 - 160.5 / 160.5) x 100 = 84.6%
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 25 years between 2022 and 1997. The average inflation rate was 2.4822985281005%.
Plugging in the values into the formula, we get:
1 (1+ % 2.48/ 100 ) ^ 25 = $1.85