Real Return Calculator
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Real Rate of Return
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Calculated using the Fisher equation. Your actual real return depends on your personal cost of living, not the general inflation rate.
A real return calculator tells you what your investment return is actually worth after accounting for inflation — the return that matters for your actual purchasing power, not just the number on your statement.
A 10% nominal return sounds solid, but if inflation is running at 6%, your real gain in purchasing power is much smaller than it appears at first glance.
How This Calculator Works
Uses the Fisher equation: Real Return = ((1 + Nominal Return) / (1 + Inflation Rate)) − 1. This is more precise than simply subtracting inflation from your nominal return, especially at higher rates.
Frequently Asked Questions
Why not just subtract inflation from my return?
Simple subtraction (nominal minus inflation) is a common approximation and works reasonably well at low rates, but it slightly overstates your real return. The Fisher equation used here is more accurate.
Can real return be negative even with a positive nominal return?
Yes — if inflation is higher than your nominal return, your real return will be negative, meaning your money's purchasing power actually shrank despite a positive return on paper.