Real return after inflation calculator
Fisher's equation, exactly.
Interactive: real return after inflationEasy
The only return that buys anything is the real one. Fisher's equation, exactly:
- Real return (exact)
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- Rule-of-thumb (n − i)
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- Price level in 10 years
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- What 100 buys in 10 years
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Real = (1+n)/(1+i) − 1. The approximation n − i is fine at low inflation and dangerously flattering at high inflation — see the inflation-linked bond page for the instrument that removes the guesswork.
The idea behind it
This calculator belongs to Fixed Income, where the mechanism it computes is explained step by step, with the formula, what each input means and where the simple model stops being right. Everything is computed in your browser; nothing you type is sent anywhere.
Instruments it applies to
- Inflation-Linked Bond — A bond that grows with the price level — real purchasing power, contractually guaranteed.
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