Analyze simple and compound present/future values alongside net present value (NPV) and internal rate of return (IRR). Save scenarios with the shareable URL or keep them handy via the favorites button.
Inputs
How it’s calculated
- Simple interest: FV = PV·(1+r·t); present value reverses the relation.
- Compound interest: FV = PV·(1+r/m)^(m·t); continuous: FV = PV·e^(r·t).
- NPV = Σ CFk/(1+r)tk at discount rate r; multiple scenarios compare different r values.
- IRR is the rate where NPV = 0; the solver uses bracketed numeric search with convergence checks. Some cash‑flows can yield multiple roots.
- The shareable URL stores inputs and the cash‑flow table so anyone can reproduce your scenario.
Results
Results are provided for educational use only. Taxes, fees, and product-specific conditions are not considered—please verify decisions with a qualified adviser.
How to compare interest and cash flows
Use the interest tab for accumulation questions and the NPV/IRR tab for dated cash-flow decisions. Keep sign conventions explicit before comparing scenarios.
How it works
Simple interest applies the rate only to principal. Compound interest reinvests each period's interest. NPV discounts each cash flow to today, while IRR searches for the discount rate that makes NPV equal zero.
When to use
Use this page for quick interest checks, cash-flow sign practice, and early planning comparisons. Move to XNPV or XIRR when cash flows happen on irregular dates.
Common mistakes to avoid
- Entering all NPV cash flows with the same sign, which makes IRR impossible.
- Comparing annual and period rates without matching compounding frequency.
- Reading IRR as a complete decision rule when NPV, scale, and timing still matter.
- Ignoring taxes, fees, reinvestment assumptions, and product restrictions.
See also
FAQ
What is the difference between simple and compound interest?
Simple interest applies the rate to the original principal only. Compound interest reinvests each period's interest so the balance accelerates over time. Reviewing both side by side helps you gauge the opportunity cost of not compounding.
Why can't the IRR be calculated?
IRR requires at least one negative and one positive cash flow. Some patterns produce multiple IRRs or none at all, so the solver may fail to converge. Adjust the cash flows or rely on the NPV table to compare scenarios.
How should I set cash-flow signs for NPV and IRR?
Enter outflows such as investments as negative values and inflows as positive values. IRR requires at least one value on each side of zero.
When should I use simple versus compound interest?
Use simple interest when interest is not reinvested. Use compound interest when each period's interest becomes part of the next period's balance.
Can I use this for official investment decisions?
No. The results are educational planning estimates and do not include taxes, fees, product restrictions, or professional suitability checks.