Calculator

Payback Period Calculator

Find out how long it takes for an investment's raw cash flows to add back up to its original cost.

← Read the Payback Period concept page

Initial investment (upfront cost)

Cash flow received at the end of each year

Number of years

yrs

Payback period

3.33 years

Upfront cost

$10,000.00

Total cash flow received

$12,000.00

How the math works

After year 1: $3,000.00 cumulative
After year 2: $6,000.00 cumulative
After year 3: $9,000.00 cumulative
After year 4: $12,000.00 cumulative

This measure deliberately ignores the time value of money — it treats every dollar of cash flow the same, no matter when it arrives, which is what makes it simpler (but less rigorous) than NPV or IRR.