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# Inflation calculator - British Pound

£5,500 in 1960
£105,947.46 in 2020

The inflation rate in the United Kingdom between 1960 and 2020 was 1,826.32%, which translates into a total increase of £100,447.46. This means that 5,500 pounds in 1960 are equivalent to 105,947.46 pounds in 2020. In other words, the purchasing power of £5,500 in 1960 equals £105,947.46 in 2020. The average annual inflation rate between these periods was 5.05%.

## Inflation timeline in the United Kingdom (1960 - 2020)

The following chart depicts the equivalence of £5,500 due to compound 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. Inflation data is provided by governments and international institutions on a monthly basis.

The following table contains relevant indicators:

Indicator Value
Cumulative inflation from 1960 to 2020 1,826.32%
Avg. Annual inflation from 1960 to 2020 5.05%
CPI 1960 5.65
CPI 2020 108.9

## 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 Consumer Price Index (CPI) formula or the compound interest formula.

### Using the CPI formula

When we have both the start and end years, we can use the following formula:

Valuet =Value0 ×
CPIt/CPI0

To obtain the values equivalent in buying power between 1960 and 2020, use the corresponding CPI values:

Value2020
=Value1960 ×
CPI2020/CPI1960
=£ 5,500 ×
108.9/5.65
£105,947.46

### Alternative: Using the compound interest formula

Given that money changes with time as a result of an inflation rate that acts as compound interest, we can use the following formula: 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, it indicates how much are £5,500 worth today. There are 60 years between 1960 and 2020 and the average inflation rate was 5.0539%. Therefore, we can resolve the formula like this:

Value2020
=PV × (1 + i)n
=£5,500 × (1 + 0.050539)60
£105,947.46

## UK inflation - Conversion table

Initial Value Equivalent value
£1 pound in 1960 £19.26 pounds in 2020
£5 pounds in 1960 £96.32 pounds in 2020
£10 pounds in 1960 £192.63 pounds in 2020
£50 pounds in 1960 £963.16 pounds in 2020
£100 pounds in 1960 £1,926.32 pounds in 2020
£500 pounds in 1960 £9,631.59 pounds in 2020
£1,000 pounds in 1960 £19,263.17 pounds in 2020
£5,000 pounds in 1960 £96,315.87 pounds in 2020
£10,000 pounds in 1960 £192,631.74 pounds in 2020
£50,000 pounds in 1960 £963,158.69 pounds in 2020
£100,000 pounds in 1960 £1,926,317.39 pounds in 2020
£500,000 pounds in 1960 £9,631,586.94 pounds in 2020
£1,000,000 pounds in 1960 £19,263,173.87 pounds in 2020
 Cumulative inflation 1960-2020 1,826.32% Avg. annual inflation 1960-2020 5.05% CPI 1960 5.65 CPI 2020 108.9

### Value of Pound over time (by year)

Period Value
1960 5,500
1961 5,689.61
1962 5,928.38
1963 6,048.04
1964 6,246.52
1965 6,544.71
1966 6,800.58
1967 6,969.38
1968 7,296.76
1969 7,694.19
1970 8,184.05
1971 8,957.02
1972 9,590.38
1973 10,472.32
1974 12,152.49
1975 15,094.28
1976 17,593.83
1977 20,380.73
1978 22,064.82
1979 25,026.2
1980 29,522.39
1981 33,028.66
1982 35,868.75
1983 37,522.05
1984 39,383.4
1985 41,774.53
1986 43,206.39
1987 44,999
1988 46,893.18
1989 49,617.27
1990 53,606.11
1991 57,594.94
1992 60,221.74
1993 61,778.36
1994 63,140.4
1995 64,794.31
1996 66,642.8
1997 68,102.13
1998 69,366.88
1999 70,631.64
2000 71,409.95
2001 72,577.41
2002 73,647.59
2003 74,620.48
2004 75,690.65
2005 77,247.27
2006 79,193.05
2007 81,041.53
2008 83,862.91
2009 85,516.82
2010 87,657.17
2011 91,062.28
2012 93,397.21
2013 95,537.56
2014 96,899.6
2015 97,288.76
2016 98,261.64
2017 100,791.15
2018 103,126.08
2019 104,877.28
2020 105,947.46

All available years

Today's value of british pounds by year:

1956 | 1957 | 1958 | 1959 | 1960 | 1961 | 1962 | 1963 | 1964 | 1965 | 1966 | 1967 | 1968 | 1969 | 1970 | 1971 | 1972 | 1973 | 1974 | 1975 | 1976 | 1977 | 1978 | 1979 | 1980 | 1981 | 1982 | 1983 | 1984 | 1985 | 1986 | 1987 | 1988 | 1989 | 1990 | 1991 | 1992 | 1993 | 1994 | 1995 | 1996 | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 |

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