# \$1 in 1945 is worth \$1.34 in 1950

\$

## Value of \$1 from 1945 to 1950

According to the Bureau of Labor Statistics consumer price index, prices in 1950 are 33.89% higher than average prices since 1945. The U.S. dollar experienced an average inflation rate of 6.01% per year during this period, causing the real value of a dollar to decrease.

In other words, \$1 in 1945 is equivalent in purchasing power to about \$1.34 in 1950, a difference of \$0.34 over 5 years.

The 1945 inflation rate was 2.27%. The inflation rate in 1950 was 1.26%. The 1950 inflation rate is lower compared to the average inflation rate of 3.44% per year between 1950 and 2020.

 Cumulative price change 33.89% Average inflation rate 6.01% Converted amount (\$1 base) \$1.34 Price difference (\$1 base) \$0.34 CPI in 1945 18.000 CPI in 1950 24.100 Inflation in 1945 2.27% Inflation in 1950 1.26%

USD Inflation since 1913
Annual Rate, the Bureau of Labor Statistics CPI

## Buying power of \$1 in 1945

This chart shows a calculation of buying power equivalence for \$1 in 1945 (price index tracking began in 1635).

For example, if you started with \$1, you would need to end with \$1.34 in order to "adjust" for inflation (sometimes refered to as "beating inflation").

When \$1 is equivalent to \$1.34 over time, that means that the "real value" of a single U.S. dollar decreases over time. In other words, a dollar will pay for fewer items at the store.

This effect explains how inflation erodes the value of a dollar over time. By calculating the value in 1945 dollars, the chart below shows how \$1 is worth less over 5 years.

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:

Dollar inflation: 1945-1950
Year Dollar Value Inflation Rate
1945 \$1.00 2.27%
1946 \$1.08 8.33%
1947 \$1.24 14.36%
1948 \$1.34 8.07%
1949 \$1.32 -1.24%
1950 \$1.34 1.26%
1951 \$1.44 7.88%
1952 \$1.47 1.92%
1953 \$1.48 0.75%
1954 \$1.49 0.75%
1955 \$1.49 -0.37%
1956 \$1.51 1.49%
1957 \$1.56 3.31%
1958 \$1.61 2.85%
1959 \$1.62 0.69%
1960 \$1.64 1.72%
1961 \$1.66 1.01%
1962 \$1.68 1.00%
1963 \$1.70 1.32%
1964 \$1.72 1.31%
1965 \$1.75 1.61%
1966 \$1.80 2.86%
1967 \$1.86 3.09%
1968 \$1.93 4.19%
1969 \$2.04 5.46%
1970 \$2.16 5.72%
1971 \$2.25 4.38%
1972 \$2.32 3.21%
1973 \$2.47 6.22%
1974 \$2.74 11.04%
1975 \$2.99 9.13%
1976 \$3.16 5.76%
1977 \$3.37 6.50%
1978 \$3.62 7.59%
1979 \$4.03 11.35%
1980 \$4.58 13.50%
1981 \$5.05 10.32%
1982 \$5.36 6.16%
1983 \$5.53 3.21%
1984 \$5.77 4.32%
1985 \$5.98 3.56%
1986 \$6.09 1.86%
1987 \$6.31 3.65%
1988 \$6.57 4.14%
1989 \$6.89 4.82%
1990 \$7.26 5.40%
1991 \$7.57 4.21%
1992 \$7.79 3.01%
1993 \$8.03 2.99%
1994 \$8.23 2.56%
1995 \$8.47 2.83%
1996 \$8.72 2.95%
1997 \$8.92 2.29%
1998 \$9.06 1.56%
1999 \$9.26 2.21%
2000 \$9.57 3.36%
2001 \$9.84 2.85%
2002 \$9.99 1.58%
2003 \$10.22 2.28%
2004 \$10.49 2.66%
2005 \$10.85 3.39%
2006 \$11.20 3.23%
2007 \$11.52 2.85%
2008 \$11.96 3.84%
2009 \$11.92 -0.36%
2010 \$12.11 1.64%
2011 \$12.50 3.16%
2012 \$12.76 2.07%
2013 \$12.94 1.46%
2014 \$13.15 1.62%
2015 \$13.17 0.12%
2016 \$13.33 1.26%
2017 \$13.62 2.13%
2018 \$13.96 2.49%
2019 \$14.20 1.76%
2020 \$14.24 0.29%*
* Compared to previous annual rate. Not final. See inflation summary for latest 12-month trailing value.

This conversion table shows various other 1945 amounts in 1950 dollars, based on the 33.89% change in prices:

Conversion Table: Value of a dollar in 1950
Initial value Equivalent value
\$1 dollar in 1945 \$1.34 dollars in 1950
\$5 dollars in 1945 \$6.69 dollars in 1950
\$10 dollars in 1945 \$13.39 dollars in 1950
\$50 dollars in 1945 \$66.94 dollars in 1950
\$100 dollars in 1945 \$133.89 dollars in 1950
\$500 dollars in 1945 \$669.44 dollars in 1950
\$1,000 dollars in 1945 \$1,338.89 dollars in 1950
\$5,000 dollars in 1945 \$6,694.44 dollars in 1950
\$10,000 dollars in 1945 \$13,388.89 dollars in 1950
\$50,000 dollars in 1945 \$66,944.44 dollars in 1950
\$100,000 dollars in 1945 \$133,888.89 dollars in 1950
\$500,000 dollars in 1945 \$669,444.44 dollars in 1950
\$1,000,000 dollars in 1945 \$1,338,888.89 dollars in 1950

## Inflation by City

Inflation can vary widely by city, even within the United States. Here's how some cities fared in 1945 to 1950 (figures shown are purchasing power equivalents of \$1):

Houston, Texas experienced the highest rate of inflation during the 5 years between 1945 and 1950 (7.14%).

San Francisco, California experienced the lowest rate of inflation during the 5 years between 1945 and 1950 (5.45%).

Note that some locations showing 0% inflation may have not yet reported latest data.

## Inflation by Country

Inflation can also vary widely by country. For comparison, in the UK £1.00 in 1945 would be equivalent to £1.26 in 1950, an absolute change of £0.26 and a cumulative change of 25.95%.

In Canada, CA\$1.00 in 1945 would be equivalent to CA\$1.40 in 1950, an absolute change of CA\$0.40 and a cumulative change of 40.22%.

Compare these numbers to the US's overall absolute change of \$0.34 and total percent change of 33.89%.

## Inflation by Spending Category

CPI is the weighted combination of many categories of spending that are tracked by the government. Breaking down these categories helps explain the main drivers behind price changes. This chart shows the average rate of inflation for select CPI categories between 1945 and 1950.

Compare these values to the overall average of 6.01% per year:

Category Avg Inflation (%) Total Inflation (%) \$1 in 1945 → 1950
Food and beverages 0.00 0.00 1.00
Housing 0.00 0.00 1.00
Apparel 5.15 28.52 1.29
Transportation 7.37 42.67 1.43
Medical care 3.70 19.91 1.20
Recreation 0.00 0.00 1.00
Education and communication 0.00 0.00 1.00
Other goods and services 0.00 0.00 1.00

The graph below compares inflation in categories of goods over time. Click on a category such as "Food" to toggle it on or off:

For all these visualizations, it's important to note that not all categories may have been tracked since 1945. This table and charts use the earliest available data for each category.

## How to Calculate Inflation Rate for \$1, 1945 to 1950

Our calculations use the following inflation rate formula to calculate the change in value between 1945 and 1950:

CPI in 1950 CPI in 1945
×
1945 USD value
=
1950 USD value

Then plug in historical CPI values. The U.S. CPI was 18 in the year 1945 and 24.1 in 1950:

24.118
×
\$1
=
\$1.34

\$1 in 1945 has the same "purchasing power" or "buying power" as \$1.34 in 1950.

To get the total inflation rate for the 5 years between 1945 and 1950, we use the following formula:

CPI in 1950 - CPI in 1945CPI in 1945
×
100
=
Cumulative inflation rate (5 years)

Plugging in the values to this equation, we get:

24.1 - 1818
×
100
=
34%

## Comparison to S&P 500 Index

The average inflation rate of 6.01% has a compounding effect between 1945 and 1950. As noted above, this yearly inflation rate compounds to produce an overall price difference of 33.89% over 5 years.

To help put this inflation into perspective, if we had invested \$1 in the S&P 500 index in 1945, our investment would be nominally worth approximately \$2.17 in 1950. This is a return on investment of 117.30%, with an absolute return of \$1.17 on top of the original \$1.

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 25.31% of returns (\$0.55) during this period. This means the inflation-adjusted real return of our \$1 investment is \$0.62. You may also want to account for capital gains tax, which would take your real return down to around \$1 for most people.

Investment in S&P 500 Index, 1945-1950
Original Amount Final Amount Change
Nominal \$1 \$2.17 117.30%
Real
\$1 \$1.62 62.30%

Information displayed above may differ slightly from other S&P 500 calculators. Minor discrepancies can occur because we use the latest CPI data for inflation, annualized inflation numbers for previous years, and we compute S&P price and dividends from January of 1945 to latest available data for 1950 using average monthly close price.

For more details on the S&P 500 between 1945 and 1950, see the stock market returns calculator.

Politics and news often influence economic performance. Here's what was happening at the time:

• The USSR captures Budapest from Germany in a battle that kills 159,000 people.
• The US Fleet captures Iwo Jima.
• 1,500 US Navy ships bomb Okinawa: the operation is believed to be the largest of World War II
• Iwo Jima is occupied by America, costing 6,000 American lives and a further 18,000 Japanese lives.
• Buchenwald, the first Nazi concentration camp, is liberated.

## Data Source & Citation

Raw data for these calculations comes from the Bureau of Labor Statistics' (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: “\$1 in 1945 → 1950 | Inflation Calculator.” Official Inflation Data, Alioth Finance, 3 Jun. 2020, https://www.officialdata.org/1945-dollars-in-1950?amount=1.