$100 in 1965 is worth $289 in 1981,
because prices increased 188.6% over that period, an average of
6.85% a year.
$100 in 1965 has
the same buying power as
$289
in 1981
Detailed inflation statistics
Cumulative price change
188.6%
Average inflation rate
6.85% per year
Converted amount ($100 base)
$289
Price difference ($100 base)
$189
CPI in 1965
31.5
CPI in 1981
90.9
Inflation in 1965
1.61%
Inflation in 1981
10.32%
$100 in 1965 → 1981
$289
$100 in 1981 → 1965
$34.65
What happened to prices between 1965 and 1981
Between 1965 and 1981, the Consumer Price Index went from 31.5 to 90.9.
Cumulatively, prices increased 188.6%, which works out to an average of
6.85% per year. Put differently, a dollar in 1965 bought what
$0.35 buys in 1981: the 1965 dollar
lost 65.3% of its purchasing power over
these 16 years.
Consumer prices rose 1.6% in 1965, up from 1964’s 1.3% in a
pickup that economists later mark as the start of the Great
Inflation, a run of accelerating
price increases driven by rising Vietnam War spending layered on top of
new Great Society programs. The war itself escalated on the ground that
March, when about 3,500 Marines came ashore at Da Nang, the first American
combat troops committed to Vietnam; troop levels would climb toward
200,000 by year’s end. Domestic policy expanded just as fast: Medicare and
Medicaid became law that July 30, creating federal health insurance for
older and low-income Americans, and the Voting Rights Act, signed that
August 6, banned literacy tests and other devices used to disenfranchise
Black voters. The civil rights movement’s gains coexisted with urban
unrest that same August, when a highway patrol traffic stop in the Watts
neighborhood of Los Angeles set off six days of rioting that left 34
people dead. Consumer prices finished 1965 218.2% above their
1913 level. First-class postage held at 5 cents, and the
minimum wage stayed at $1.25 an hour.
Every 1965 amount converts to 1981 at the same ratio, 2.89: $1,000 becomes
$2,886, and $10,000 becomes $28,857.
Amount in 1965
Value in 1981
$1.00
$2.89
$5.00
$14.43
$10.00
$28.86
$20.00
$57.71
$50.00
$144
$100
$289
$500
$1,443
$1,000
$2,886
$5,000
$14,429
$10,000
$28,857
$100,000
$288,571
$1,000,000
$2,885,714
Inflation by spending category, 1965–1981
Between 1965 and 1981, energy rose the most, up 326.6%, while apparel rose the least, up 99.4%, against 188.6% for all items. The headline number is an average; here is what $100 of 1965
spending costs in 1981, by category:
Category
Avg. yearly inflation
$100 in 1965 →
All items (CPI-U)
6.85%
$289
Energy
9.49%
$427
Medical care
7.73%
$329
Transportation
6.93%
$292
Food
6.90%
$291
Core (all items less food & energy)
6.47%
$273
Apparel
4.41%
$199
Not shown because the BLS began these indexes after 1965: housing (1967–), recreation (1993–), education & communication (1993–).
Decade by decade: 1965 to 1981
Prices climbed fastest in the 1980s, averaging 10.32% a year, and slowest in the 1960s (4.26% a year). Each step below chains into the full 1965–1981 change:
Years
Avg. yearly inflation
Price change
$100 from 1965, at end
1965–1970
4.26%
23.2%
$123
1970–1980
7.82%
112.4%
$262
1980–1981
10.32%
10.3%
$289
Year by year: CPI and the value of $100 from 1965
$100 from 1965 had already become $141 by
1973, on its way to $289 in 1981; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 2.9% in 1966.
In 1981, prices rose 10.3% and $100 from 1965 had the buying
power of $289; the year's average CPI of 90.9 is the level
behind every 1981 figure on this page.
1981 was the year the inflation fever finally broke, at an extraordinary price.
Consumer prices rose 10.3%, the second year of back-to-back double-digit
inflation and the last time the U.S. would see one. To end it, Paul Volcker’s
Federal Reserve drove its policy rate above 19% and let borrowing costs go
where they may: a 30-year mortgage cost more than 18% by autumn, car loans and
business credit froze, and homebuilders mailed the Fed two-by-fours in protest.
The squeeze tipped the economy into recession in July, the deep 1981–82
downturn that would push unemployment past 10%. But it worked. Inflation fell
by nearly half within a year and to under 4% by 1983, the disinflation that
defined the following two decades. Even the price of mailing a letter told the
year’s story: postage went up twice in eight months.
MLA: “Inflation from 1965 to 1981: $100 is worth $289 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1965-to-1981/
APA: InflationCalculator.com. Inflation from 1965 to 1981. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1965-to-1981/