Internal Rate of Return Calculator

Estimate the annualized return that makes the net present value of an investment zero by comparing the starting outlay and the ending value across a set number of periods.

Amount paid at the start
Value received at the end
Use years unless otherwise noted

Educational information only; not financial advice.

Examples

  • $50,000 initial → $65,000 final over 4 years ⇒ 6.78 % IRR
  • $12,500 initial → $9,800 final over 2 years ⇒ -11.46 % IRR

FAQ

What does the calculator assume about cash flows?

It assumes a single initial outflow followed by a single ending value, producing an annualized rate similar to CAGR.

Can I enter months instead of years?

Yes. Convert the total duration into fractional years, such as 18 months entered as 1.5 periods.

What if the initial investment is zero?

IRR is undefined when the starting amount is zero because the formula divides by the initial investment.

Additional Information

  • Formula: IRR = [(Final Value ÷ Initial Investment)^(1/Periods) − 1] × 100.
  • IRR expresses the time-adjusted return assuming equal-length periods.
  • Requires positive starting and ending values; negative outcomes produce a negative IRR percentage.

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