NPV and IRR Calculator
Discounted cash flow analysis - paste a year-by-year cash flow stream and get the net present value and internal rate of return at your chosen discount rate.
About the NPV and IRR Calculator
The NPV and IRR Calculator handles the two most important discounted-cash-flow metrics in one place. NPV tells you the dollar value of a project after discounting future cash flows back to today; IRR tells you the effective annual return implied by those cash flows. Together they answer the only two questions that matter in capital budgeting: is this worth doing, and how much does it earn?
Paste a year-by-year cash flow stream (negative for outflows, positive for inflows) and the calculator returns both metrics. Adjust your discount rate to model different scenarios - a higher discount rate punishes far-out cash flows more, which surfaces projects that look great on paper but rely on distant assumptions.
Common use cases
- Decide whether to greenlight a multi-year capital project
- Compare two acquisition targets with different cash flow profiles
- Stress-test a SaaS rollout under different growth assumptions
- Validate vendor financing offers vs paying cash upfront
Tips for accurate results
Use NPV as the decision rule and IRR as the communication tool. NPV gives a clean dollar answer; IRR gives a percentage that non-finance people understand intuitively. When NPV and IRR disagree (rare, but possible with non-conventional cash flows), trust NPV. Always document the discount rate you used - the choice has a bigger effect on the answer than the cash flows themselves.
Privacy & data handling
The NPV and IRR Calculator runs entirely in your browser. Nothing you enter is uploaded, logged, or shared with third parties - the math happens locally and your inputs disappear when you close the tab. There is no signup, no email collection, and no daily-use limit.
What is NPV in plain English?
Net Present Value is what a future stream of cash is worth in today's dollars. Because money tomorrow is worth less than money today (inflation + opportunity cost), each year's cash is shrunk by the discount rate before summing. A positive NPV means the project earns more than your cost of capital; a negative NPV means it loses value compared to the alternative.
How do I choose a discount rate?
For corporate decisions, use your weighted average cost of capital (WACC) - typically 8-12% for established firms. For personal projects, use the return you'd get on the next-best alternative (often the S&P 500's ~7% real return, or your mortgage rate). Higher discount rates penalize distant cash flows more heavily, so they favor short payback projects.
What is IRR and why does it matter?
IRR is the discount rate that makes NPV exactly zero - effectively the implied annual return of the project. Compare IRR to your cost of capital: if IRR > WACC, the project creates value. IRR and NPV usually agree on accept/reject, but they can rank competing projects differently, so use both.
When does IRR give misleading results?
When cash flows switch signs more than once (e.g., big negative late in the project), there can be multiple IRRs that satisfy the equation - the tool flags this case. Also, IRR ignores project scale: a small 100% return looks better than a large 20% return, even if the latter creates more dollar value. NPV is the tiebreaker.
What's the difference between NPV and ROI?
ROI is a single-period percentage that ignores when cash flows happen. NPV considers timing - a dollar in year 1 is worth more than a dollar in year 5. For any project longer than a year with uneven cash flows, NPV is the right tool. ROI is fine for quick comparisons of similar-duration investments.
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