IRR Calculator – Measure Your Investment's True Return
Calculate the Internal Rate of Return (IRR) of investments with multiple cash flows, contributions and withdrawals — quickly, clearly and easily.
Sample visual only – not a calculated result.
IRR Calculator
Enter your investment cash flows to estimate the Internal Rate of Return (IRR). Use negative values for money invested and positive values for money received.
Estimated IRR
IRR is an estimate based on the cash flows you enter, assuming equally spaced periods (such as years). It is not a guarantee of future returns.
Your Investment Cash Flow Timeline
Red cards show money going out, green cards show money coming in.
What Is IRR (Internal Rate of Return)?
IRR (Internal Rate of Return) is the annualised rate at which the net present value of an investment's cash flows becomes zero.
In simple words, it is the single yearly return rate that explains all the money you put in and took out. It is especially useful for multiple investments, multiple withdrawals, uneven cash flows, different investment dates, business or project cash flows, private investments and portfolio cash flows. For example, if you invest ₹1,00,000 today and receive money back over four years, IRR tells you the yearly rate that fits that whole pattern.
How IRR Works
Enter your initial investment
Add the starting amount as a negative cash flow in Year 0.
Add later cash flows
Add subsequent contributions, withdrawals or returns for each period.
Get the annualised rate
The calculator estimates the annualised rate that makes the present value of all cash flows equal to zero.
IRR Example
Suppose you invest ₹1,00,000 at Year 0 and receive ₹20,000 in Year 1, ₹30,000 in Year 2, ₹40,000 in Year 3 and ₹50,000 in Year 4. The IRR is calculated from this complete cash-flow series, not from any one figure. Press Example Data above and then Calculate IRR to see the result computed live.
IRR vs CAGR – What's the Difference?
CAGR suits a single starting value and a single ending value; IRR suits multiple cash flows at different points in time.
| Feature | IRR | CAGR |
|---|---|---|
| Multiple cash flows | Supported | Not supported |
| Single initial + final value | Works, gives same result as CAGR | Designed for this |
| Uneven investments | Handles them | Not suitable |
| Regular / irregular investments | Both, using period series | Not suitable |
| Investment timing | Considered | Only start and end |
| Use case | SIPs, projects, withdrawals | Growth of one lump sum |
Need Date-Based Returns?
Try XIRR Calculator
When your investments happen on different dates, XIRR can provide a more practical annualised return calculation based on the exact cash-flow dates.
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Annualised returns using exact cash-flow dates.
Calculate Now →Why Use an IRR Calculator?
Compare Investment Opportunities
Put different cash-flow patterns on one yearly scale.
Understand Annualised Returns
See your return as a yearly rate, not just a total.
Analyse Uneven Cash Flows
Handle irregular contributions and withdrawals.
Evaluate Long-Term Investments
Review multi-year projects and plans clearly.
Understand Investment Timing
Learn how earlier or later cash changes the result.
Make Better Financial Comparisons
Use one consistent measure when comparing options.
Important Limitations of IRR
- IRR depends entirely on the cash flows you enter.
- Some investments can have multiple IRRs.
- IRR may not be meaningful for unusual cash-flow patterns.
- IRR implicitly assumes interim cash can be reinvested at the same rate, which may not match real investor experience.
- IRR does not guarantee future returns.
- Tax, fees, inflation and liquidity can change actual outcomes.
IRR Calculator – Frequently Asked Questions
What is IRR?
IRR (Internal Rate of Return) is the annualised rate at which the net present value of an investment's cash flows becomes zero.
How is IRR calculated?
IRR is found by numerical search: the calculator looks for the rate r that makes the sum of each cash flow divided by (1+r) to the power of its period equal to zero. This calculator uses Newton-Raphson with a bisection fallback.
What is a good IRR?
There is no universal good IRR. It depends on risk, your goals, inflation and the alternatives available. Compare it with the return you need and with other options.
What is the difference between IRR and CAGR?
CAGR measures growth from one starting value to one ending value. IRR handles several investments and withdrawals at different times.
When should I use IRR instead of CAGR?
Use IRR when you have multiple or uneven cash flows. Use CAGR when you have one initial amount and one final value.
What is XIRR?
XIRR is IRR calculated with the exact date of every cash flow, which suits investments made on irregular dates. Try our XIRR Calculator.
Can IRR be negative?
Yes. If the money you receive is less than what you invested once timing is considered, the IRR is negative.
Can an investment have more than one IRR?
Yes. When cash flows switch between negative and positive more than once, the equation can have several solutions, so the result may be ambiguous.
Does IRR guarantee investment returns?
No. IRR is an estimate from the cash flows you enter and does not guarantee future returns.
Is this IRR calculator free?
Yes, it is free and runs entirely in your browser. Your entries are not sent anywhere.
Understand Your Investment Before You Invest
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