Adjust a nominal return for inflation.
Please do not make financial decisions based on these results.
What is the Real Rate of Return Calculator?
Adjust a nominal return for inflation. To use the Real Rate of Return Calculator, enter nominal return, inflation, amount, years; it returns real rate of return, future value (nominal), future value in today’s dollars, and shows them instantly as you type.
Comparing returns
To judge past performance use the average return calculator and the ROI calculator. For projects with several cash flows, the IRR calculator gives a single comparable rate, and the payback period calculator shows how long it takes to recover the cost.
How to use the Real Rate of Return Calculator
- Enter your numbers. The inputs are Nominal return (%), Inflation (%), Amount ($), Years. Use a rate of return you consider realistic; small changes compound into large differences. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the Real rate of return, and the cards below show Future value (nominal), Future value in today’s dollars. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Real Rate of Return Calculator using the default values shown in the calculator above:
Inputs
| Nominal return (%) | 8 |
|---|---|
| Inflation (%) | 3.4 |
| Amount ($) | 10,000 |
| Years | 10 |
Results
| Real rate of return | 4.45% |
|---|---|
| Future value (nominal) | $21,589.25 |
| Future value in today’s dollars | $15,453.69 |
With these inputs the calculator returns Real rate of return: 4.45%. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Nominal return (%) from 8 to 9.6 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| Real rate of return | 4.45% | 6% | +34.8% |
| Future value (nominal) | $21,589.25 | $25,009.53 | +15.8% |
| Future value in today’s dollars | $15,453.69 | $17,901.94 | +15.8% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Real Rate of Return Calculator reports Real rate of return, future value (nominal) and future value in today’s dollars. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. Investment returns are not guaranteed. The result shows what the numbers you enter would produce, not what the market will do. It is for information, not financial, tax or legal advice.
Frequently asked questions
Why use the real return?
It shows the change in purchasing power, not just the change in dollars.
Are investment returns guaranteed?
No. Real returns vary. Use these tools to compare scenarios, not to predict results.
What rate of return should I assume?
There is no guaranteed rate. Test a range of conservative and optimistic rates, and remember that fees and inflation reduce your real return.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
Related investment calculators
- Rate of Return Calculator
- Annualized Rate of Return Calculator
- Annualized Return Calculator
- Holding Period Return Calculator
- Equivalent Rate Calculator – AER
- Expected Return Calculator
- MIRR Calculator - Modified Internal Rate of Return
- Investment Calculator
- Interest Rate Calculator
- Average Return Calculator
- IRR Calculator
- CAGR Calculator (Compound Annual Growth Rate)