# Value of £400 40 years later



## rmelly (15 Jan 2008)

Trying to roughly figure out how much £400 from 40 years ago would be worth in €'s today.

Is this the correct approach:

Figures from: [broken link removed]

1970: €3.62
2006: €43.37

For 36 years, divide €43.37 by €3.62 and multiply by 400, then divide by .787 (for Euro conversion of the 400 figure).

The rough total for 36 years is approx €6000.

Is this correct, or should I be looking at the CPI figures?


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## ClubMan (15 Jan 2008)

rmelly said:


> then divide by .787 (for Euro conversion of the 400 figure).


To convert IR£ to € you should divide by 0.787564 and then round to two decimal places.


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## rmelly (15 Jan 2008)

thanks - is the rest okay?


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## ClubMan (15 Jan 2008)

I think so but am not 100% sure. I get €6,080 or thereabouts too. 

I think the _CPI _figures are probably the best estimate of the purchasing power of money over time.


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## rmelly (15 Jan 2008)

thanks - I'll try the CPI figures later to see what it comes up with.


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## askU (15 Jan 2008)

Would any one know what £400 would have bought you 40 years ago? or even a fraction of £400?


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## ClubMan (15 Jan 2008)

About 2,500 pints of Guinness?


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## z109 (15 Jan 2008)

askU said:


> Would any one know what £400 would have bought you 40 years ago? or even a fraction of £400?


Not sure you can approach it like that.

A four-bed semi in Swords cost about £1600 in 1972. So it has increased to EUR 100,000

A 286 PC cost about £2000 in 1985. So it has decreased to EUR 200.

Clubman's beer inflation index is probably as accurate as it gets - I remember doing similar comparisons at college on a history course to try and work out relative purchasing power!


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## HighFlier (15 Jan 2008)

Can I have the address of that 4 bed semi I'd like to put in an offer!


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## z109 (15 Jan 2008)

HighFlier said:


> Can I have the address of that 4 bed semi I'd like to put in an offer!


That would be £1600/£400 = about a quarter of the house price, the 100,000 is the equivalent quarter of the price (yes, probably still an understatement, but a nice round number!).


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## asdfg (15 Jan 2008)

> 1970: €3.62
> 2006: €43.37


 
Isn't the conversion done already - 
1970 Euro 3.62 
2006 Euro 43.37

So divide by 3.62 and multiply by 43.37


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## ClubMan (15 Jan 2008)

That's effectively what the original poster did. The way I'd do it (same result) is...

Convert to €: IR£400 / 0.787564 = €507.90
Normalise back to base units: €507.90 / 3.62 = €140.30 
Calculate 2006 equivalent value: €140.30 x 43.37 = €6,084.81


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