Real Rate of Return Calculator (Inflation-Adjusted)
Real rate of return calculator: inflation-adjusted return from the nominal return and inflation (Fisher equation).
rreal = 1 + i1 + π − 1
How to use this calculator
- Choose the quantity you want under “Solve for”.
- Type the known values and pick their units: any combination works.
- The result updates as you type. Open “Show the steps” to see the substitution.
Your real return is what you gain in purchasing power: rreal = (1 + i) ÷ (1 + π) − 1. The quick approximation i − π slightly overstates it.
A savings account paying 3 % during 4 % inflation has a negative real return.
Estimates for information only, not financial advice.
Formula
rreal = 1 + i1 + π − 1
| Symbol | Quantity | Units |
|---|---|---|
| i | Nominal return | %, × |
| π | Inflation | %, × |
| rreal | Real return | %, × |
Worked example
Given: i = 7 % · π = 3 %
rreal = 1 + i1 + π − 1
Result: rreal = 3.8835 %
Frequently asked questions
What is the real return of 7 % with 3 % inflation?
1.07 ÷ 1.03 − 1 = 3.88 %.