Inflation Adjusted Return Calculator

📊

Inflation Adjusted Return measures the real return on an investment after accounting for the impact of inflation, reflecting the actual increase in purchasing power. More info →

Input

Enter investment return and inflation rate.

💡

How This Calculator Works

A return of 12% doesn't make you 12% richer if prices also rose. The real return is how much your buying power actually grew. The calculator uses the exact formula, not simple subtraction, so the real return is slightly different from return minus inflation.

The Formula

Real Return = [(1 + Nominal Return) ÷ (1 + Inflation)] − 1

Inflation impact = Nominal return − Real return

What Each Input Does

Return from Investment (%): The return you earned or expect, before inflation (the nominal return).
Inflation (%): How fast prices rose over the same period. It must be greater than −100%.

Step by Step

Both percentages are converted to decimals.
(1 + return) is divided by (1 + inflation), and 1 is subtracted.
The real return and the inflation impact are shown to 2 decimals.

Reading the Result

Positive – your buying power grew.

Zero – you only kept pace with prices.

Negative – your money buys less than before.

Quick Example

Return 12%, inflation 6%. Real return = 1.12 ÷ 1.06 − 1 = 5.66%, so inflation took away 6.34 percentage points.