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Real Rate of Return Deflator

Your 7.5% FD sounds good until you strip out tax and inflation. See what you're actually earning.

⚠Analysis tool — not investment advice. Results are estimates for educational purposes only and do not constitute a recommendation to buy, sell, or hold any security. Past performance is not indicative of future results. For personalised advice, consult a SEBI-registered investment advisor.

Who this is for

Anyone parking money in "safe" instruments — FDs, PPF, savings accounts — and wondering if they're actually preserving purchasing power. Especially useful if you're near retirement and relying on fixed income.

Nominal return

The headline rate your bank or fund quotes — before tax or inflation.

Real return

What you actually earn after stripping out inflation. If inflation is 6% and your after-tax return is 5.5%, your real return is −0.5% — you're losing purchasing power.

Inflation rate

CPI (Consumer Price Index) measures how much more expensive a basket of goods gets each year. India's long-run CPI average is ~5–6%.

Instrument

Your Numbers

The interest rate the bank/scheme advertises

0%, 5%, 10%, 20%, or 30% — your marginal rate

India CPI avg 2015–2024 ≈ 5.5–6.5%

Real rate of return

-0.71%

Your money is losing purchasing power.

Return waterfall

Nominal / quoted rate
+7.50%
Tax drag (30%)
-2.25%
After-tax return
+5.25%
Inflation drag (6%)
-5.96%
Real return
-0.71%
Bank FD / RD: Interest taxed as income at your slab rate every year (TDS applies).

All instruments at 7.5%

Bank FD / RD-0.71%
Savings Account-0.71%
PPF+1.42%
Debt Mutual Fund (held >3 yrs)+0.00%
Equity Mutual Fund / ETF+0.53%
Sovereign Gold Bond+1.42%
Govt / RBI Bond-0.71%

Real return = after-tax return minus inflation. Highlighted = your selection.