PureTools
ROI Calculator
Calculate your return on investment, simple ROI, annualized CAGR, inflation-adjusted real return and after-tax return, all in one dashboard.
Investment Details
Optional Adjustments
Total Return
+0.00%Simple ROI
Projected Returns at Current Annual Rate
| Period | Value | ROI | Real ROI |
|---|
How to use the ROI Calculator
This calculator gives you four complementary views of your investment return side by side, from the raw total gain to the annualized rate, the inflation-eroded real value and the after-tax take-home. Use Final Value mode when you know what the investment is worth today, or switch to Net Profit mode if you already know the dollar gain or loss.
- Enter your initial investment, the amount you originally put in.
- Enter the final value or net profit, what the investment is worth now, or the dollar profit (negative for a loss).
- Add the duration, years and months. This unlocks the annualized CAGR and the projection table.
- Toggle inflation adjustment to see your real purchasing-power return after rising prices are factored out. The default rate of 3% reflects the US long-run average.
- Toggle capital gains tax to estimate your after-tax return. The default 15% matches the US long-term capital gains rate for most investors.
- Copy the summary to paste your results into a spreadsheet, email or financial plan.
Simple ROI vs. CAGR, which should you use?
Simple ROI tells you the total percentage gain over the life of an investment, regardless of how long it took. CAGR (Compound Annual Growth Rate) tells you the equivalent constant annual rate that would have produced that same total return. CAGR is essential when comparing investments held for different durations, a 100% ROI over 1 year vastly outperforms the same 100% ROI over 10 years, but simple ROI alone won't show that. Use the Compound Interest Calculator to project how CAGR compounds into future wealth over time.
The projection table
Projected Returns at Current Annual Rate shows what your investment would be worth at 1, 2, 3, 5, 10 and 20 years if it continued to grow at its current CAGR. This stress-test view helps you visualize the power of compounding and identify whether your return rate is sustainable for long-term planning. The Real ROI column adjusts each projected period for cumulative inflation, only visible when inflation adjustment is enabled.
Frequently asked questions
What is ROI and how is it calculated?
ROI (Return on Investment) measures the gain or loss generated relative to the amount invested. The formula is: ROI = (Final Value − Initial Investment) ÷ Initial Investment × 100. For example, investing $10,000 and receiving $12,500 back gives a 25% ROI. ROI does not account for the time it took to earn that return, for time-adjusted comparisons, use CAGR instead. Both are shown side by side in this calculator so you always have the full picture.
What is CAGR and how does it differ from simple ROI?
CAGR (Compound Annual Growth Rate) is the annualized version of ROI. While simple ROI shows your total return regardless of time, CAGR expresses what constant annual rate would have produced that same result. Formula: CAGR = (Final Value ÷ Initial Value) ^ (1 ÷ Years) − 1. A 50% simple ROI over 5 years equals roughly 8.45% CAGR, a more useful number when comparing investments with different durations. If you invested for less than one year, enter the exact months and the calculator handles fractional periods automatically.
What is inflation-adjusted ROI and why does it matter?
Inflation erodes purchasing power over time. A 20% nominal ROI over 5 years with 3% annual inflation translates to a meaningfully lower real ROI because your dollars buy less. This calculator computes cumulative inflation over the full holding period, not just per year, and applies it correctly to your total return. Always compare nominal returns to real returns when evaluating long-horizon investments such as real estate, retirement accounts or index funds. The US long-run average inflation rate is roughly 3%, but you can enter any rate to model different scenarios.
How do taxes affect my investment return?
Capital gains taxes reduce your effective take-home return. After-Tax ROI = (Net Profit × (1 − Tax Rate)) ÷ Initial Investment × 100. For US investors, short-term gains (assets held under 12 months) are taxed as ordinary income, up to 37%. Long-term gains qualify for preferential rates of 0%, 15%, or 20% depending on your income bracket. The calculator defaults to 15%, which applies to most US investors. Adjust the rate to match your specific situation. Always consult a qualified tax professional for personalized advice.
What is a good ROI?
A good ROI depends on the investment type, duration, risk, and opportunity cost. The S&P 500 has averaged roughly 10% annually (nominally) or about 7% after inflation over the long term, making it a common benchmark. Real estate often targets 6–12% annually including appreciation. Conservative bonds deliver 2–5%. A short-term business investment might require 20–50% annually to justify the risk. Never evaluate ROI in isolation: always ask "compared to what?" and factor in risk, liquidity, taxes and inflation to get a true picture.
What is the difference between ROI and net profit?
Net profit is the raw dollar gain or loss (Final Value − Initial Investment). ROI is that dollar figure expressed as a percentage of the initial investment, which makes it comparable across different investment sizes. A $5,000 profit on a $10,000 investment (50% ROI) is far more impressive than the same $5,000 profit on a $500,000 investment (1% ROI). ROI normalizes your return so you can rank opportunities of different sizes on an equal footing. Use the Percentage Calculator for related percentage computations.
Can ROI be negative?
Yes, a negative ROI means you lost money relative to your initial investment. If you invested $10,000 and the investment is now worth $8,000, your ROI is −20%. Negative ROI is common in volatile assets, failed business ventures, or market downturns. This calculator displays losses in red so you can immediately see whether an investment gained or lost value. CAGR is also calculated correctly for losses, giving you the annualized rate of decline.
Is my data saved after I close the tab?
No. All inputs are stored in sessionStorage only, which is automatically cleared the moment you close the tab or browser window. Nothing is ever sent to a server, all calculations happen entirely inside your browser. Your investment amounts, profit figures, tax rates and inflation assumptions remain completely private. This is the core of PureTools' zero-trace privacy commitment. Your data is never used to train AI models or improve machine learning systems.