What if my annual cash flow varies year to year?

This calculator assumes a constant annual cash flow, dividing initial investment by that flat amount. If your cash flows vary, subtract each year's actual cash flow from the remaining balance manually until it reaches zero for an accurate payback period.

Why doesn't payback period account for the time value of money?

This is the simple payback period, which treats a rupee received in year five the same as a rupee received today. For a discounted view that accounts for the time value of money, use the NPV & IRR calculator instead.

Payback Period Calculator

Calculate how long it takes to recover an investment from its cash flows.

How this is calculated

Payback period = initial investment ÷ annual cash flow

Assumptions used in this calculation

Constant, undiscounted annual cash flow: Assumes the same cash flow recurs every year and does not discount future cash flows to present value, unlike NPV or IRR.

About this calculator

Calculates the simple payback period, how many years it takes for an investment's cash flows to recover its initial cost, assuming a constant annual cash flow.

Worked example

₹1,00,000 investment, ₹25,000/year cash flow

Result: Payback period = 4 years

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Payback Period Calculator

About this calculator

Frequently asked questions

What if my annual cash flow varies year to year?

Why doesn't payback period account for the time value of money?

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