Your savings account paid 4% last year. Inflation ran at 4%. You earned zero — and that is the polite version.
Calculators do the heavy lifting, but knowing what is going on underneath is what saves you money — or stress — later. Your savings account paid 4% last year. Inflation ran at 4%. You earned zero — and that is the polite version.
The headline number. What your statement shows.
Nominal minus inflation. The only number that buys things.
US stocks have returned ~10% nominal, ~7% real. Bonds ~5% nominal, ~2% real. Cash ~0% real, often negative.
Why don't headlines use real returns? Smaller numbers, harder to celebrate. Always do the inflation subtraction yourself.
What's a 'good' real return? 4–5% real annualised is excellent over 20+ years.
Whatever number you land on, sanity-check it against a second method or a quick estimate in your head.