Inflation calculator - British Pound

£5,500 in 1960

£106,045.23 in 2020

The inflation rate in United Kingdom between 1960 and 2020 was 1,828.1%, which translates into a total increase of £100,545.23. This means that 5,500 pounds in 1960 are equivalent to 106,045.23 pounds in 2020. In other words, the purchasing power of £5,500 in 1960 equals £106,045.23 in 2020. The average annual inflation rate between these periods was 5.06%.

Inflation timeline in United Kingdom (1960 - 2020)

The following chart depicts the equivalence of £5,500 throughout the years due to inflation and CPI changes. All values are equivalent in terms of purchasing power, which means that for each year the same goods or services could be bought with the indicated amount of money.

All calculations are performed in the local currency (GBP) and using 6 decimal digits. Results show only up to 2 decimal digits to favour readability.

The following table contains relevant indicators:

Indicator Value
Total Inflation (1960-2020) 1,828.1%
Annual inflation avg. (1960-2020) 5.06%
CPI 1960 5.63
CPI 2020 108.5
£1 in 1960 £19.28 in 2020

How to calculate the time value of money with inflation data?

There are several ways to calculate the time value of money. Depending on the data available, results can be obtained by using the compound interest formula or the Consumer Price Index (CPI) formula.

Using the compound interest formula

Given that money changes with time as a result of an inflation rate that acts as a compound interest, the following formula can be used: FV = PV (1 + i)n, where:

  • FV: Future Value
  • PV: Present Value
  • i: Interest rate (inflation)
  • n: Number of times the interest is compounded (i.e. # of years)

In this case, the future value represents the final amount obtained after applying the inflation rate to our initial value. In other words, the future value is the amount in 2020 that equals £5,500 in 1960 in terms of purchasing power. There are 60 years between 1960 and 2020 and the average inflation rate was 5.0555%. Therefore, we can resolve the formula like this:

FV = PV (1 + i)n = £5500 * (1 + 0.050555)60 = £106,045.226534 ≈ £106,045.23

Using the CPI formula

When the CPI for both start and end years is known, the following formula can be used:

Final value = Initial value *
CPI final/CPI initial

In this case, the CPI in 1960 was 5.63 and in 2020 was 108.5. Therefore,

Final value = Initial value *
CPI final/CPI initial
= £5,500 *
108.5/5.63
= £106,045.23

United Kingdom inflation - Conversion table

Initial Value Equivalent value
£1 pound in 1960 £19.28 pounds in 2020
£5 pounds in 1960 £96.4 pounds in 2020
£10 pounds in 1960 £192.81 pounds in 2020
£50 pounds in 1960 £964.05 pounds in 2020
£100 pounds in 1960 £1,928.1 pounds in 2020
£500 pounds in 1960 £9,640.48 pounds in 2020
£1,000 pounds in 1960 £19,280.95 pounds in 2020
£5,000 pounds in 1960 £96,404.75 pounds in 2020
£10,000 pounds in 1960 £192,809.5 pounds in 2020
£50,000 pounds in 1960 £964,047.51 pounds in 2020
£100,000 pounds in 1960 £1,928,095.03 pounds in 2020
£500,000 pounds in 1960 £9,640,475.14 pounds in 2020
£1,000,000 pounds in 1960 £19,280,950.28 pounds in 2020

Value of Pound over time (by year)

Period Value
1960 5,500
1961 5,599.82
1962 5,844.37
1963 5,999.22
1964 6,110.64
1965 6,403.86
1966 6,691.21
1967 6,937.51
1968 7,107.58
1969 7,529.81
1970 7,881.67
1971 8,503.29
1972 9,271.52
1973 9,981.1
1974 11,036.68
1975 13,148.68
1976 16,421.79
1977 18,896.3
1978 21,190.86
1979 22,968.01
1980 26,927.23
1981 30,998.94
1982 34,733.2
1983 36,611.59
1984 38,557.46
1985 40,323.36
1986 42,599.56
1987 44,197.04
1988 45,838.9
1989 48,184.61
1990 51,018.99
1991 55,710.4
1992 59,326.68
1993 61,183.7
1994 62,552.02
1995 64,018.09
1996 65,972.84
1997 67,829.85
1998 69,100.44
1999 70,371.03
2000 71,446.14
2001 72,325.78
2002 73,303.15
2003 74,573.74
2004 75,551.12
2005 76,821.7
2006 78,483.24
2007 80,731.2
2008 82,588.22
2009 85,129.39
2010 86,888.67
2011 89,625.32
2012 92,850.66
2013 95,098.62
2014 96,955.64
2015 97,639.8
2016 98,128.49
2017 99,887.76
2018 102,624.41
2019 104,676.9
2020 106,045.23