Real Return — what is left after inflation?
Live calculation of the inflation-adjusted return of your investment. Compare nominal end values with the real purchasing power in today's money — and see how different inflation scenarios affect your wealth.
Your assumptions
Detailed breakdown
Path: nominal vs. real
Inflation scenarios compared
How does the real end value of your investment change at different inflation rates — same nominal return and horizon?
| Inflation | Real return p.a. | Real end value | Purchasing power loss |
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Why real return is the only honest number
Inflation is the invisible tax inspector of your wealth. As long as gross return exceeds inflation, your purchasing power grows. If it falls below, you get poorer every year — even when your account balance rises. A savings account at 0.5 % interest with 3 % inflation loses 2.5 % real per year.
Over long horizons the effect amplifies dramatically. At 3 % inflation, purchasing power halves every 24 years. €100,000 in a savings account is worth only about €41,200 in today's purchasing power 30 years from now — without anything disappearing in nominal terms. That is exactly why equities, ETFs and other real assets exist as long-term wealth vehicles.
Rule of thumb: a real return of 5–7 % p.a. has historically been achievable with a globally diversified equity portfolio over 20+ years. Bonds returned 1–3 % real. Savings deposits mostly negative real. Avoiding risk just pays it in another currency: a slow loss of purchasing power.
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Frequently asked questions about real return
What is the difference between nominal and real return?
Nominal return is the stated value increase in euros. Real return subtracts inflation and shows the actual gain in purchasing power. At 7 % nominal and 3 % inflation, the real return is about 3.88 %. Formula: real = (1 + nominal) / (1 + inflation) − 1.
Why is "nominal minus inflation" not enough?
Subtraction is an approximation — fine at low inflation, inaccurate at high. At 8 % return and 6 % inflation: subtraction gives 2 %, correct is 1.89 %. Over 30 years that is several thousand euros of difference.
What is purchasing power?
How many goods €1 can buy. At 3 % inflation, purchasing power halves every 24 years. To build real wealth, you must beat inflation.
What inflation rate should I assume?
ECB targets 2 %. Historical German inflation 1999–2024 averaged about 2.1 % p.a. with peaks above 8 % (2022/23). Cautious midpoint: 2.5–3 %.
What real return is realistic long-term?
Global equity indices (MSCI World, S&P 500) returned 5–7 % p.a. real over 50–100 years. Bonds 1–3 % real, savings deposits mostly negative real.
How does compounding interact with inflation?
Compounding works on the real return too — just from a smaller base. €10,000 at 7 % nominal over 30 years = €76,123 nominal, but only about €31,355 of today's purchasing power (at 3 % inflation).
Does the calculator include taxes?
No. It shows the real pre-tax return. In Germany: 25 % KESt + 5.5 % solidarity surcharge (effective 26.375 %), Austria: 27.5 % KESt. Use our tax calculator for that.
Are the results binding?
No. It is a model with constant assumptions. In reality both values fluctuate. Not investment advice.