Inflation has already eaten up PLN 120 from the 500+ program in real terms

Due to high inflation, the 500 plus benefit is now worth only PLN 380 at the prices at the beginning of the program, i.e. April 2016. For the benefit to have the same real value today as in 2016, it should now amount to PLN 658. If they were to be indexed by an increase in fuel prices, instead of 500+, it should now be 930+.

About the author

Pawel Majtkowski - analyst eToro on the Polish market, which shares its weekly commentary on the latest stock market information. Paweł is a recognized expert on financial markets with extensive experience as an analyst in financial institutions. He is also one of the most cited experts in the field of economy and financial markets in Poland. He graduated from law studies at the University of Warsaw. He is also the author of many publications in the field of investing, personal finance and economy.

Inflation eats savings ... and more

Due to high inflation and the drop in the real value of the 500+ benefit, calls for its valorization are appearing more and more often. In order for this benefit to be of real value today as in April 2016, i.e. at the beginning of the program, it should now amount to PLN 658. A further increase in inflation, to 18%, may increase this amount to PLN 700 within a few months. And then it turns out that even a change from 500+ to 700+ may not restore the full real value of this benefit.

The 500 plus program was launched on April 1, 2016 and was the implementation of one of the main election promises of PiS. However, from the beginning, the program assumed a fixed amount of the benefit, which had not been adjusted so far. As a result, the real value of the service is gradually decreasing. In recent months, high inflation (13,9% y / y in May) has significantly lowered the real value of 500+. In December 2021, this value was PLN 419, to drop to PLN 6 within 380 months.

Official CPI inflation given by the Central Statistical Office of Poland is an average basket of consumer goods. However, there are products that have increased more than inflation. For example, 95 gasoline cost PLN 2016 / l in April 4,30, currently the price is PLN 8 / l, i.e. as much as 86 percent. more. If the 500+ benefit was to be valorized by an increase in fuel prices, it should amount today to 930+.

How much is the benefit from the 500 plus program really worth (in prices as of 1.04.2016 April XNUMX)? Source: GUS, eToro calculations