Payback Period Calculator

Your details

The upfront cost or capital outlay you want to recover.
Choose a steady annual inflow, or switch to irregular to enter a separate cash flow for every year.
The net cash the investment returns in its first year.
How much the yearly cash flow rises (or falls, use a negative number) each year. Leave at 0 for a level stream.
%
Set above 0 to get the discounted payback period, which accounts for the time value of money. Use your required return or cost of capital.
%
Enter how long the investment runs to get total return, average return and a simple ROI.
Currency
Payback periodModerate payback
4years
Equivalent in months48months
4 yr
Fast<2Moderate2-5Slow5+

This investment pays for itself in about 4 years.

  • At about 12,500 returned in year one, you recoup the 50,000 outlay in roughly 48 months.
  • A shorter payback period means less time exposed to risk, but it ignores any profit earned after the break-even point.

Next stepPair payback with net present value or internal rate of return to weigh the full life of the project.

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