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Understand the method before using any result. The details below describe the purpose and assumptions for this tool.
How the payback period calculator works
The payback period calculator helps you estimate results using the assumptions and values you provide. Review the formula and example before relying on the result.
Formula and assumptions
Simple payback period = initial investment ÷ annual net cash inflow, assuming constant annual cash flow.
Example
A 1,000 investment and 250 annual net cash inflow has a 4-year simple payback period.
Important information
Results depend on the values, jurisdiction, date and assumptions you enter. Financial products, tax rules and medical recommendations may vary by location and change over time. Verify critical results with reliable sources.