Each cash flow with its year offset; negatives are invested, positives are received.
Year offset
Cash flow
Year 0
-10,000
Year 1
-5,000
Year 2
18,000
Estimates only — not financial, tax, or professional advice.
100% private — every number you enter is calculated in your browser and never sent to our servers.
What it calculates: XIRR, Total Invested, Total Received, Net Gain.
Updated 5 June 2026 · Transparent assumptions
The two payments were not invested for the same length of time
The default schedule pays in 10,000 at the start and 5,000 a year later, then receives 18,000 at year two. Total in 15,000, total out 18,000, a gain of 3,000 — which looks like 20%. But the first 10,000 worked for two years and the second 5,000 for only one, so the annualised rate that actually reconciles those dates is 11.47%.
XIRR finds the single discount rate at which every cash flow, discounted back to the start, sums to zero. There is no closed form; it is solved by iteration. That is the whole reason it exists — any calculation that simply divides gain by outlay ignores when the money went in, and for anything paid in over time that is most of the answer.
Regular investing is exactly the case simple returns get wrong
Someone investing monthly for ten years has money that has been working for ten years and money that has been working for a month. Dividing the total gain by the total invested treats them identically and understates the return substantially — often by a factor of nearly two for a long, steady contribution plan.
XIRR is the standard measure for this and is what fund platforms report for an individual\u2019s account. It is also the right way to compare your own outcome against a fund\u2019s published return, which is time-weighted and describes the fund rather than your contribution schedule.
Money leaving you is negative; money arriving is positive
Purchases, contributions and any outflow are entered as negative; sales, dividends, redemptions and the closing value are positive. Getting a sign wrong does not produce a warning — it produces a plausible-looking rate that describes a different investment entirely.
The series also needs at least one of each sign or there is no rate that makes the present value zero. And where the signs alternate more than once, the equation can have several mathematically valid solutions; the iteration returns one of them, and for such schedules the result should be treated with care.
Reinvestment at the same rate, and dates you entered accurately
Like any internal rate of return, XIRR assumes intermediate cash flows are reinvested at the XIRR itself. Where the rate is high, that assumption is optimistic, and the modified internal rate of return exists to replace it with an explicit reinvestment rate.
The timings carry as much weight as the amounts. Entering flows in whole years when they occurred mid-year shifts the answer, and for short overall horizons the shift can be large. Spreadsheet XIRR functions take actual dates for this reason; entering fractional years here is the equivalent and is worth doing precisely.
Sources & References
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
ROISimple, date-based, and net ROI with annualised ROI (CAGR), a reverse target solver, and a two-investment comparison.
Annualized ReturnThe compound annual rate behind a total return, with the growth multiple alongside it.
InvestmentProject lump-sum and regular-contribution growth, plan a goal, and solve future vs present value, with fees and inflation.
Regular InvestmentProject how regular monthly contributions grow over time — SIP-style investing, dollar-cost averaging, inflation-adjusted value, and long-term goals.
Returns are assumptions, not guarantees. Actual results may vary because of market performance, taxes, fees, inflation, and timing. This is an educational projection, not investment advice.
Published the calculator with its formula, worked example, assumptions, limitations and a bespoke guide, and added an automated formula test suite covering it.
Verified that the solved rate discounts every cash flow back to zero at its own date, checked against an independently written present-value function rather than the engine’s own.
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