According to the Bureau of Labor Statistics consumer price index, prices in 2016 are 57.48% higher than average prices throughout 1995. The dollar experienced an average inflation rate of 2.19% per year during this period, meaning the real value of a dollar decreased.
In other words, $4,500 in 1995 is equivalent in purchasing power to about $7,086.82 in 2016, a difference of $2,586.82 over 21 years.
The 1995 inflation rate was 2.83%. The inflation rate in 2016 was 1.26%. The 2016 inflation rate is lower compared to the average inflation rate of 1.93% per year between 2016 and 2019.
|Cumulative price change||57.48%|
|Average inflation rate||2.19%|
|Converted amount ($4,500 base)||$7,086.82|
|Price difference ($4,500 base)||$2,586.82|
|CPI in 1995||152.400|
|CPI in 2016||240.007|
|Inflation in 1995||2.83%|
|Inflation in 2016||1.26%|
This chart shows calculation of buying power equivalence, often referred to as "the value of a dollar" over time for $4,500 in 1995 (price index tracking began in 1635).
According to the Bureau of Labor Statistics, each of these USD amounts below is equal in terms of what it could buy at the time:
|Year||Dollar Value||Inflation Rate|
Inflation can vary widely by city, even within the United States. Here's how some cities fared in 1995 to 2016 (figures shown are purchasing power equivalents of $4,500):
Seattle, Washington experienced the highest rate of inflation during the 21 years between 1995 and 2016 (4.23%).
Chicago, Illinois experienced the lowest rate of inflation during the 21 years between 1995 and 2016 (1.94%).
Note that some locations showing 0% inflation may have not yet reported latest data.
Inflation can also vary widely by country. For comparison, in the UK £4,500.00 in 1995 would be equivalent to £7,938.88 in 2016, an absolute change of £3,438.88 and a cumulative change of 76.42%.
In Canada, CA$4,500.00 in 1995 would be equivalent to CA$6,580.87 in 2016, an absolute change of CA$2,080.87 and a cumulative change of 46.24%.
Compare these numbers to the US's overall absolute change of $2,586.82 and total percent change of 57.48%.
CPI is the weighted combination of many categories of spending that are tracked by the government. This chart shows the average rate of inflation for select CPI categories between 1995 and 2016.
Compare these values to the overall average of 2.19% per year:
|Category||Avg Inflation (%)||Total Inflation (%)||$4,500 in 1995 → 2016|
|Used cars and trucks||-0.41||-8.29||4,126.74|
|Medical care services||3.84||120.70||9,931.31|
|Medical care commodities||2.82||79.38||8,072.19|
It's important to note that not all categories may be tracked since 1995. This table and visualization use the earliest available data for each category.
This inflation calculator uses the following inflation rate formula:
Then plug in historical CPI values. The U.S. CPI was 152.4 in the year 1995 and 240.007 in 2016:
$4,500 in 1995 has the same "purchasing power" or "buying power" as $7,086.82 in 2016.
To get the total inflation rate for the 21 years between 1995 and 2016, we use the following formula:
Plugging in the values to this equation, we get:
The above data describe the CPI for all items. Also of note is the Core CPI, which measures inflation for all items except for the more volatile categories of food and energy. Core inflation averaged 2.06% per year between 1995 and 2016 (vs all-CPI inflation of 2.19%), for an inflation total of 53.60%.
When using the core inflation measurement, $4,500 in 1995 is equivalent in buying power to $6,911.98 in 2016, a difference of $2,411.98. Recall that for All Items, the converted amount is $7,086.82 with a difference of $2,586.82.
In 1995, core inflation was 2.99%.
The average inflation rate of 2.19% has a compounding effect between 1995 and 2016. As noted above, this yearly inflation rate compounds to produce an overall price difference of 57.48% over 21 years.
To help put this inflation into perspective, if we had invested $4,500 in the S&P 500 index in 1995, our investment would be nominally worth approximately $33,121.51 in 2016. This is a return on investment of 636.03%, with an absolute return of $28,621.51.
These numbers are not inflation adjusted, so they are considered nominal. In order to evaluate the real return on our investment, we must calculate the return with inflation taken into account.
The compounding effect of inflation would account for 36.50% of returns ($10,447.38) during this period. This means the inflation-adjusted real return of our $4,500 investment is $18,174.13.
|Original Amount||Final Amount||Change|
Politics and news often influence economic performance. Here's what was happening at the time:
Raw data for these calculations comes from the Bureau of Labor Statistics' Consumer Price Index (CPI), established in 1913. Inflation data from 1665 to 1912 is sourced from a historical study conducted by political science professor Robert Sahr at Oregon State University.
You may use the following MLA citation for this page: “$4,500 in 1995 → 2016 | Inflation Calculator.” U.S. Official Inflation Data, Alioth Finance, 25 Apr. 2019, https://www.officialdata.org/1995-dollars-in-2016?amount=4500.
Special thanks to QuickChart for providing downloadable chart images.
in2013dollars.com is a reference website maintained by the Official Data Foundation.