● Inflation-adjusted return

Real Return Calculator

Find out how much purchasing power you actually gain — after inflation, taxes, and management fees.

A 10% nominal return with 4% inflation and 20% tax leaves you with a real gain of only about 4.0% — not 6%. This calculator applies Fisher's equation to show your true return precisely.

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Nominal rate · Inflation · Tax · Management fee

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Your inputs

Nominal return rate

% /yr

Inflation rate — enter your country's CPI

% /yr

Tax on gains (0 if tax-exempt)

Management fee (ETF TER, fund expense ratio)

% /yr

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Results

Gross nominal return

—

After management fee

—

After tax on gains

—

Inflation rate

—

Real return (purchasing power gain)

—

How it's calculated

Fisher's equation: the correct way to calculate real return

Subtracting inflation from your nominal rate is only an approximation. The precise formula — Fisher's equation — divides the net return by the inflation factor:

Net return = Nominal − Fee − (Nominal − Fee) × Tax rate Real return = (1 + Net return) ÷ (1 + Inflation) − 1 Example: 8% nominal, 0.2% fee, 15% tax, 3% inflation Net = 8% − 0.2% − (7.8% × 15%) = 8% − 0.2% − 1.17% = 6.63% Real = (1.0663) ÷ (1.03) − 1 = 3.52%

1
Deduct management fee
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2
Deduct tax on gains
—
3
Apply Fisher's equation
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Nominal return: The stated rate before adjusting for inflation or taxes.
Real return: The gain in actual purchasing power — what matters for your standard of living.
Fisher equation: (1 + nominal) ÷ (1 + inflation) − 1. More accurate than simple subtraction.
Management fee / TER: Annual cost charged by a fund or ETF (Total Expense Ratio). Reduces your effective return before taxes.

🔢 Worked example

An 8% nominal return, minus a 0.2% fee and 15% tax, gives a 6.63% net return. After 3% inflation, the real return is (1.0663 ÷ 1.03) − 1 ≈ 3.5% — what actually grows your purchasing power.

Disclaimer: estimation tool for planning. Tax treatment varies by country and investment type. Consult a tax adviser for your specific situation. Always confirm with an official source before deciding.

Frequently asked questions

Why not just subtract inflation from nominal return?

Subtraction is an approximation. At 10% nominal and 5% inflation, simple subtraction gives 5% — but the correct Fisher equation gives 4.76%. The difference is small at low rates but significant at high inflation environments.

Can my real return be negative?

Yes. If inflation outpaces your net return, you lose purchasing power even if your account balance grows. This is called "losing to inflation" and affects savings accounts in high-inflation periods.

What inflation rate should I use?

Use your country's official CPI (US: Bureau of Labor Statistics; EU: Eurostat HICP; UK: ONS; India: MoSPI). For long-term planning, central bank targets (typically 2%) are common. You can also enter a personal inflation estimate based on your spending.

Does management fee apply before or after tax?

Fees are deducted from your return before the gain is calculated for tax purposes. A 0.2% fee on a 8% fund leaves 7.8% — and tax applies to the 7.8% gain, not the original 8%.

Should I include the management fee?

Yes, always. A 1% annual fee on a 7% fund leaves you with 6% — and compounded over 30 years, it can cost 20–25% of your final balance.

Are my results saved? Do I need an account?

No account or sign-up needed. Every calculation is saved automatically in your own browser, and you can also pin a result with the save button. Nothing is sent to any server: the data stays on your device and can be erased at any time with the clear button.

How do I track my progress over time?

From the fourth entry onward a “View comparison chart” button appears, opening a line chart with every entry in time order plus an indicator panel: total change, average per entry, lowest and highest value and the period covered. You can also export the history as CSV.

About this calculator

This real return calculator strips taxes and inflation out of a headline (nominal) return to show what you actually gained — the growth that truly increases your purchasing power. A high advertised yield can shrink dramatically once these two forces are accounted for.

The inflation adjustment uses the Fisher equation: (1 + return) ÷ (1 + inflation) − 1, applied after tax. For tax-exempt investments, enter a tax rate of 0%. Read the result as the return that matters: if it is near zero or negative, your money is holding its value at best, not growing in real terms.

By Vinicius Fonseca · Reviewed against official sources · Updated Jul 2026 · How we calculate →