Payback Period Calculator
Find how long an investment takes to pay for itself, with or without discounting future cash flows.
Payback period
2.6 years
- Discounted payback (at 10%)
- 3.051 years
- Total cash flows
- 1,800.00
Assumes each year's cash flow arrives evenly through the year.
Show the work
Still to recover after year 2
investment − cash flows so far
1,000.00 − 300.00 − 400.00 = 300.00
Full years + the part of the next year needed
t + amount left ÷ next cash flow
2 + 300.00 ÷ 500.00 = 2.6 years
Estimates for general information only — not financial advice.
How it works
Payback = years before full recovery + (amount still unrecovered ÷ next year's cash flow); discounted payback uses CFₜ ÷ (1 + r)^t
Questions
- How does the payback period calculator work?
- Payback = years before full recovery + (amount still unrecovered ÷ next year's cash flow); discounted payback uses CFₜ ÷ (1 + r)^t.
- What do I need to enter?
- Initial investment, Discount rate, Cash flow each year. Optional fields can be left blank.
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