Internal Rate of Return is the annualized return that makes the NPV of all cash flows equal zero. A higher IRR than your required return means the investment is worth taking.

What are the weaknesses of IRR?

IRR can be misleading with unconventional cash flows. It also assumes all positive cash flows are reinvested at the IRR rate, which may not be realistic. Always compare IRR with NPV.

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Compound Interest Calculator — Final Amount & APY

See how a single deposit grows with compound interest. Pick how often the interest compounds — daily for crypto/stocks, monthly for HYSAs, quarterly for bonds.

Initial investment ($)

Year 1 cash flow ($)

Year 2 cash flow ($)

Year 3 cash flow ($)

$0.00

IRR

Internal Rate of Return

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NPV at 10%

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Years

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IRR is the annualized return that makes NPV equal zero.

How compounding frequency matters

A 5% rate compounded daily yields 5.1267% APY; compounded monthly it is 5.116%; annually, 5.0%. The difference is small at low rates, but at 20% or higher, daily compounding can add 0.5-1% extra per year. For practical purposes, monthly is the right default for most savings accounts.

How this calculator works

Understanding Internal Rate of Return

IRR is the discount rate at which an investment breaks even in present value terms. Think of it as the interest rate you are earning on your money — a single percentage easy to compare across investments.

📈

Compound Interest Calculator — Final Amount & APY

See how a single deposit grows with compound interest. Pick how often the interest compounds — daily for crypto/stocks, monthly for HYSAs, quarterly for bonds.

Initial investment ($)

Year 1 cash flow ($)

Year 2 cash flow ($)

Year 3 cash flow ($)

$0.00

IRR

Internal Rate of Return

—

NPV at 10%

—

Years

—

IRR is the annualized return that makes NPV equal zero.

How compounding frequency matters