This tool helps you easily calculate the real interest rate on your investments after adjusting for inflation.

## Real Interest Rate Calculator

Use this calculator to find the real interest rate by considering the nominal interest rate, inflation rate, and the number of compounding periods per year.

### How to Use

- Enter the Nominal Interest Rate in percentage (e.g., 5 for 5%).
- Enter the Inflation Rate in percentage (e.g., 3 for 3%).
- Enter the number of Compounding Periods per year (e.g., 12 for monthly, 4 for quarterly).
- Click the Calculate button to see the Real Interest Rate.

### How it Calculates

The calculator uses the following formula to determine the real interest rate:

`Real Interest Rate = ((1 + Effective Nominal Rate) / (1 + Effective Inflation Rate)) - 1`

The Effective Nominal Rate is calculated by adjusting the nominal rate with compounding periods using the formula:

`Effective Nominal Rate = (1 + Nominal Rate / Compounding Periods) ^ Compounding Periods - 1`

The Effective Inflation Rate is calculated as:

`Effective Inflation Rate = (1 + Inflation Rate) - 1`

### Limitations

- This calculator assumes that the inflation rate is constant throughout the period.
- It does not account for taxes or other potential costs.
- The results are based on the inputs’ accuracy; ensure you enter the correct data.