Finance
Payback Period Calculator
How long until an investment pays for itself.
Result
3.33 yr
Simple payback period
In months
40.0
Recovers
$6,000.00 / yr
Download results
Quick summary
Compute the simple payback period for an investment given a constant annual cash flow.
How to calculate payback period manually
- Enter your input values into the Payback Period calculator above.
- Review the formula and assumptions in the Expert Guide section.
- Adjust the inputs to model different scenarios in real time.
- Save or export the results once they match your scenario.
Compute the simple payback period for an investment given a constant annual cash flow.
How it works
Payback = Initial investment / Annual cash flow.
Example
$20,000 investment, $6,000/yr → 3.33 years.
Insight
Payback period benchmarks by industry
Typical capital investment recovery windows used by CFOs.
| Sector | Acceptable payback | Hurdle IRR |
|---|---|---|
| Software / SaaS | 12–18 months | 30 %+ |
| Manufacturing | 3–5 years | 15 % |
| Energy infrastructure | 7–10 years | 8–12 % |
| Real estate | 10–15 years | 8 % |
| Consumer hardware | 2–3 years | 20 % |
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