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Inflation-Adjusted Return Calculator

Adjust a nominal return for inflation over the same period.

  • Formula & worked example
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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Edit a calculated value to solve backwards, or lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

Divide one plus the nominal return by one plus inflation, then subtract one. A 26% nominal return with 5% inflation produces a 20% real return under this formula.

Real return = (1 + nominal return) ÷ (1 + inflation) − 1

Worked example

Enter these known values and leave the other values blank.

Nominal rate of return
26 %
Inflation rate
5 %
Real rate of return
20 %

Assumptions and limitations

  • Use values from a consistent period, scope and currency. The stated formula defines this simplified model; the explanation describes quantities it leaves out.

Common questions

Can I subtract inflation from the nominal return?

Subtraction is an approximation that is closer when rates are small. This calculator uses the ratio formula and expects both rates to cover the same period.

References

The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.

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