Payback Period Calculator
How many years until cumulative cash flows equal the initial investment.
Result
Payback period
3.25 years
- Initial$100,000.00
- Sum of CFs$180,000.00
- StatusPaid back at year 3.25
Step-by-step
- Cumulative cash flow reaches $100,000 between year 3 and 4.
- Linear interpolation gives payback at 3.25 years.
How to use this calculator
- Enter initial investment.
- List annual cash flows.
- Read payback period in years (with fractional interpolation).
About this calculator
Payback period is the simplest capital-budgeting metric: how long until cumulative cash flows recoup the initial investment. Doesn't account for time value of money or post-payback cash flows — that's why most analysts pair it with NPV/IRR. Useful as a liquidity / risk indicator.
Frequently asked
Simple to compute and explain. Useful for liquidity assessment ("get my money back fast"). Works as a quick screen.
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