Calculator
Real Return After Inflation
A nominal return tells you how the number grows. A real return tells you whether you can buy more than before. Subtracting inflation from the nominal rate is the usual shortcut and it overstates the answer, so this uses the Fisher relation instead.
Real return after inflation
Real return after inflation:5.7%
- Value on paper
- ₹54,73,566
- Worth in today’s money
- ₹22,83,928
What this assumes
Every calculator here states what it took for granted. A result whose assumptions are hidden is not worth much.
- Uses the Fisher relation rather than subtracting inflation, which overstates the result.
- Inflation is assumed constant across the period.
- No tax is deducted, and tax is charged on the nominal gain rather than the real one.
How to use it
- Enter the return you expect and the inflation you expect.
- Compare the value on paper against what it is worth in today’s money.
Illustrative only. Not a projection, not a guarantee, and not investment advice.
Common questions
Why not just subtract inflation from the return?
Because it is not quite right, and the error compounds. Twelve percent against six percent inflation is a real return of 5.66 percent, not six. Over a thirty-year horizon that difference is substantial.
Does tax make this worse?
Yes. Tax is charged on the nominal gain, not the real one, so you can be taxed on growth that never increased your purchasing power. It is one reason the tax treatment of an investment matters as much as its headline return.
A number is not a plan.
If this result raised a question, that is the useful part. Bring it in and we will work through what it means for your situation.