Financial Calculators
Real Rate of Return Calculator
Calculate the inflation-adjusted real rate of return from a nominal rate and inflation rate using the Fisher equation locally in your browser.
Enter a nominal rate of return and an inflation rate to calculate the real (inflation-adjusted) rate of return using the exact Fisher equation. This calculator runs privately in your browser; your numbers are not uploaded or stored.
See the true purchasing power growth of your investments.
Enter a nominal rate of return and an inflation rate to calculate the real rate of return using the exact Fisher equation: (1 + nominal) / (1 + inflation) − 1. The simple approximation (nominal − inflation) is also shown for comparison. The exact formula is more accurate, especially when rates are higher. For example, a 7% nominal return with 3% inflation gives a real return of about 3.88%, not 4%. This private browser estimate is for general planning only, not financial, investment, or tax advice; your values are not uploaded or stored.
Frequently Asked Questions
Everything you need to know about this tool, how it works, and privacy.
What is the real rate of return?
The real rate of return is the nominal return adjusted for inflation. It represents the actual purchasing power growth of an investment. If your portfolio earned 7% nominally and inflation was 3%, your real purchasing power grew by about 3.88%, not 4%.
What formula does this calculator use?
The calculator uses the exact Fisher equation: real rate = (1 + nominal) / (1 + inflation) − 1, where nominal and inflation are expressed as decimals (e.g., 7% = 0.07). The simple approximation (nominal − inflation) is also shown but becomes less accurate at higher rates.
Why use the Fisher equation instead of simple subtraction?
Simple subtraction (nominal − inflation) ignores the compounding effect of inflation on the nominal return. The Fisher equation is exact: a 7% nominal return with 3% inflation gives 3.88% real return, not 4%. The difference matters more at higher rates.
Can the real rate be negative?
Yes. If the inflation rate exceeds the nominal rate, the real rate is negative, meaning the investment lost purchasing power. For example, a 2% nominal return with 5% inflation gives a real return of about -2.86%.
Do my values stay private?
Yes. The calculation and copy action run locally in your browser. CodeASystem does not upload or store the values you enter.