Modified IRR with realistic reinvestment. The MIRR Calculator takes initial investment, cash flow year 1, year 2, year 3, year 4, year 5, reinvestment rate for the cash flows and returns modified internal rate of return plus future value of the cash flows at the reinvestment rate, ordinary irr for comparison. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Investment maths is about comparing money at different points in time on a fair basis. Compound rates, discounting and annualised returns let you compare options of different sizes and durations. Use the worked example below to check the maths against your own figures.
How the MIRR Calculator works
Ordinary IRR assumes every cash flow is reinvested at the IRR itself, which flatters good projects. MIRR reinvests at a rate you choose (usually your cost of capital), giving a more realistic return over a five-year horizon.
Worked example
With the example values (initial investment of $100,000, cash flow year 1 of $30,000, year 2 of $30,000, year 3 of $30,000, year 4 of $30,000, year 5 of $30,000, reinvestment rate for the cash flows of 8%), the modified internal rate of return is 11.97%; future value of the cash flows at the reinvestment rate $175,998.03, ordinary irr for comparison 15.24%. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
Related Calculators
Frequently Asked Questions
How is modified internal rate of return calculated?
MIRR = (future value of cash flows at the reinvestment rate ÷ initial investment)1/n − 1.
Which figures do I need?
Initial investment, cash flow year 1, year 2, year 3, year 4, year 5, reinvestment rate for the cash flows. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Does the calculator account for taxes and fees?
Only where there is an input for them. For a true net return, add fees and taxes to your inputs or use the stock and crypto profit calculators, which include them.
