Rentabilidad real vs. nominal

Definition

Nominal return is the raw percentage a product advertises; real return is that percentage after subtracting inflation — the number that actually reflects a change in purchasing power.

Why it matters

In high-inflation Latin American economies, a product with an attractive nominal rate can still have a negative real return — always ask "real or nominal?" before comparing two rates.

How it works in practice

The quick version is to subtract inflation from the nominal rate. The precise version divides: real ≈ (1 + nominal) ÷ (1 + inflation) − 1, which matters once both numbers are large. Two further adjustments are usually missing from the advertised figure: fees, which come off the return, and tax, which in most of the region is charged on the nominal gain rather than the real one — so inflation is taxed along with the return.

A concrete example

A deposit pays 12% over a year while inflation runs at 8%. The real return is (1.12 ÷ 1.08) − 1 ≈ 3.7%, not 4%. Now assume tax is withheld on the 12% nominal gain: after tax the nominal figure drops, and the real return can land near zero — even though the account balance clearly went up.

What people most often get wrong

A bigger number in the account is not the same as more purchasing power, and this is precisely how a "safe" product loses money quietly for years. When comparing two products, put both on the same footing: same period, both net of fees, both against the same inflation figure, and check which of the two published rates is real and which is nominal.

Frequently asked questions

Which inflation figure should I use?

The official national index published by your country's statistics agency for the same period as the return. Your personal inflation can differ from the national average depending on what you actually spend on, but the official index is the comparable, verifiable benchmark.

Are there products that pay a real rate directly?

Yes — inflation-linked instruments exist across the region, such as Brazil's IPCA-linked treasury bonds or Mexico's UDI-denominated instruments. They quote a spread over inflation, so what you see already is a real rate before fees and tax.

Educational content only — not financial or tax advice. Rates, limits and tax rules change: confirm current figures with the regulator or tax authority before deciding.