Inflation and Indexing
14 June 2007, 08:57 AM
#1
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Inflation and Indexing
What is the best way to index/inflate some item into todays money.
eg House costing $20,000 in 1976 to todays value.
eg Item costing $1,000 in 1990 to todays value.
Thx.
eg House costing $20,000 in 1976 to todays value.
eg Item costing $1,000 in 1990 to todays value.
Thx.
14 June 2007, 09:53 AM
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Depends on country for a start. The US house inflation is somewhat different to UK house inflation. Additionally house price inflation might not be the same as the normal inflation rate etc etc.
There's a website that you can look at that shows what houses in your street sold for (in the uk) over history (not sure how far it goes back) and that will give you an accurate picture.;
As for other items, it depends on the item. for example consumer electronic goods have got a lot cheaper over the last few years. e.g. 12 years ago I bought a PC for uni, it cost £1000. Add inflation(3% p/a) and that £1425 wheras an equivalent PC now would be around £500 so 1/3rd of the cost!! On the flipside, council tax and utilities have gone up (gas, electric, petrol etc.).
You need the inflation rate for each year to work out what £1 in 1990 is worth now. £1.70 assuming that inflation rate was 3% each year. at 3% things double every 23/4 years or so. e.g. something cosing £1 in 1983 would cost £2 now. But, as I say, it depends on the item. (oh, and inflation has been higher than 3% p/a over the last 24 years so that £1 will probably be somewhat more than £2!!! but for simplicity I'm using a constant 3% a year for explanatory purposes.
There's a website that you can look at that shows what houses in your street sold for (in the uk) over history (not sure how far it goes back) and that will give you an accurate picture.;
As for other items, it depends on the item. for example consumer electronic goods have got a lot cheaper over the last few years. e.g. 12 years ago I bought a PC for uni, it cost £1000. Add inflation(3% p/a) and that £1425 wheras an equivalent PC now would be around £500 so 1/3rd of the cost!! On the flipside, council tax and utilities have gone up (gas, electric, petrol etc.).
You need the inflation rate for each year to work out what £1 in 1990 is worth now. £1.70 assuming that inflation rate was 3% each year. at 3% things double every 23/4 years or so. e.g. something cosing £1 in 1983 would cost £2 now. But, as I say, it depends on the item. (oh, and inflation has been higher than 3% p/a over the last 24 years so that £1 will probably be somewhat more than £2!!! but for simplicity I'm using a constant 3% a year for explanatory purposes.
Last edited by Dracoro; 14 June 2007 at 09:59 AM.
17 June 2007, 09:07 AM
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thanks for the info.
I thought there were tables for this sort of thing.
Basically I've just been turned down for a AUD $500 credit card, despite have a barclaycard with a GBP £7,500 credit limit back in the late 80's. And being a home owner since 1994 !!!
I want to write a very rude letter to citibank, as the purpose of the card is JUST to get a 10% discount on fuel. I wont spend $500 bucks on fuel a month. And I'll put my major purchases on my Westpac credit card.
So I was just hoping to inflate my credit limit accurately. The house (not mine) was just an add on.
As you can see, citibank is p1ss1ing me off, just a tad.
I thought there were tables for this sort of thing.
Basically I've just been turned down for a AUD $500 credit card, despite have a barclaycard with a GBP £7,500 credit limit back in the late 80's. And being a home owner since 1994 !!!
I want to write a very rude letter to citibank, as the purpose of the card is JUST to get a 10% discount on fuel. I wont spend $500 bucks on fuel a month. And I'll put my major purchases on my Westpac credit card.
So I was just hoping to inflate my credit limit accurately. The house (not mine) was just an add on.
As you can see, citibank is p1ss1ing me off, just a tad.
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