Investment Growth & Inflation Calculator

Why this matters

Headline returns can look healthy on paper, but inflation quietly reduces what those gains mean in day-to-day life. A steady five percent annual return can lose a large chunk of its real value if prices rise by three percent for many years. The chart shows the gap clearly. The darker nominal line keeps climbing while the teal real line flattens because purchasing power is being eroded.

How to set sensible assumptions

• Return: use a long-run average rather than last year’s performance. Steadier inputs lead to more useful planning.
• Fees: small fee differences compound. Reducing costs by half a percent can be worth thousands over a long horizon.
• Inflation: try a range. Two to four percent is a useful test band for many economies over time.
• Contributions: consistency matters. Regular deposits help smooth market ups and downs.

What the results mean

• Nominal portfolio: the value before inflation. This is the number most statements show.
• Real spending power: the same value expressed in today’s currency. This is the figure that matters when planning future costs.
• Average real growth: a compound annual rate based on your first and last real values. Aim to keep this positive after fees.

Practical next steps

• Run two or three scenarios with different return, fee and inflation assumptions. Save each link for easy comparison.
• Export the table to CSV and add notes on how your contributions might change in future years.
• Review once or twice a year. Small changes to fees and savings rates can have a bigger impact than chasing short-term performance.

This calculator is for guidance only and does not provide financial advice. Markets and prices can move unexpectedly. If you are unsure, consider speaking to a qualified adviser.