When ROI and Inflation Collide

This is kind of a strange subject, but hear me out.  When you deal with financial math, especially using the financial formulas to project out what your investments are going to be in the future you not only encounter a Return on Investment (ROI) but you also have to take into account an inflation rate.  I have been using the very good Excel calculator at https://www.vertex42.com/Calculators/retirement-withdrawal-calculator.html , with some modifications, in order to accomplish this computation.  What is nice about this calculator is that it does the amounts by month and incorporates both the ROI and the Inflation Rate.  By linking the ROT and Inflation Rate to a transition tab on my Excel spreadsheets, I am able to play what-if games to determine when the money will run out in a given account.  Some of the modifications that I have made to this spreadsheet include pulling the initial values of the account from a different location and changing the starting time.  I have also incorporated the RMD table from IRS into the calculations, i.e. the value that comes out is at least equal to the RMD value when I am past 72 years of age.

I also have discovered a different means of calculations.  There is an equivalent ROI when you include both the expected ROI and the Inflation Rate:

equivalent_ROI% = ( ( 1 + ROI% ) / ( 1 + Inflation% ) ) -1

That gives a fixed value that can be used in financial formulas to introduce an equivalent rate of return containing the effect of the inflation as though it were a constant amount withdrawn.  If you want to include the tax rate as part of the computations, you can change the ROI% to:

adjusted_ROI% = ROI% * ( 1 - marginal_tax_rate% )

By plugging in the adjusted_ROI% into the formula above in place of ROI%, you have introduced not only the inflation percentage, but also the effect of taxes into the computation.

Disclaimer: I am not a financial person, only a person with an interest in math.  Please verify these formulas prior to use, I'm not responsible for any havoc that they may cause.