NPV decision calculator.
Should you do it?
Net present valuenet present valueThe sum of all future cash flows from a decision, each discounted back to today's value, minus any upfront cost. Positive NPV means the decision creates wealth at your discount rate.Full definition measures the value of future cash flows discounted to today, minus the upfront cost. Compare paying off debt with investing, taking a new job, or making a one-time investment with ongoing returns.
The question it answersDoes this decision actually create wealth once I discount it back to today?
Rules: United States. Privacy: runs in your browser. What you enter stays on your device unless you copy a share link, which puts your inputs in the link.
NPV > 0: the decision creates wealth at your discount ratediscount rateThe rate used to convert future money to today's value. Higher discount rate equals future money worth less today. In personal finance: typically your expected investment return, what you give up by spending now instead of investing.. NPV < 0: it destroys wealth. The discount rate is what you would otherwise earn on the same money. Use 7% as a default if you have no other anchor; that is roughly long-run real US equity return.
Methodology: bars/lines update with the active scenario. Debt: guaranteed return = debt rate, investment expected return is uncertain.
Projection, not a promise. The result follows the assumptions you enter. Real results will differ, sometimes by a lot.
How NPV math works
- Present value of a future amount: PV = FV / (1 + r)n. $100 received in 10 years at 7% discount rate is worth $50.83 today.
- Net present value: sum of all discounted future cash flows minus initial cost. Positive NPV means the decision creates value at your discount rate.
- The discount rate matters more than people realize. A solar-panel investment is positive NPV at 4% and negative NPV at 12%. Same project, same costs, same savings. Different opportunity costopportunity costWhat you silently give up when you pick one option over another. Spending $100 today on dinner means giving up whatever that $100 could have grown into if you had invested it instead.Full definition.
- Pay off debt vs invest is the simplest case. Paying down debt at rate D produces a guaranteed D% return. Investing produces an expected R% return with uncertainty. If D is more than 1 point above R: pay debt. If R is more than 2 points above D: invest. In between, the verdict reads "close" and leans to paying the debt; the certainty premium usually wins.
- This tool uses real (inflation-adjustedInflation-adjustedAdjusted for rising prices. Some amounts move with inflation, like IRS tax brackets, TIPS principal, or I-bond rates. Others are restated in today's dollars so different years can be compared: by the BLS consumer price index, $30,000 in 1985 bought about what $93,000 buys in 2026.) discount rates in the job and lump-sum scenarios, because salaries and savings are held flat in today's dollars there. The debt scenario compares against a nominal APR, so its expected return must be nominal too. Mixing the two bases skews the answer: 3% inflationinflationA general increase in prices over time, meaning each dollar buys less than it did before.Full definition over 25 years cuts purchasing powerPurchasing powerWhat money can actually buy, not the number on the bill or in the account. Inflation shrinks it over time: by the BLS consumer price index, it takes more than $8 today to buy what $1 bought in 1971. Same dollar, much less buying ability.Full definition by about half.
Not financial advice. NPV depends on inputs; verify your discount rate before relying on the verdict.
HOW THIS IS CALCULATED
This tool runs entirely in your browser: no data is sent to any server. General NPV rules are under "How NPV math works" above. Per scenario:
- Debt vs invest: months to payoff = ln(P ÷ (P − B × r)) ÷ ln(1 + r), rounded up, where B is the balance, P the monthly cash and r = APR ÷ 12 (B ÷ P at a 0% rate; "Never" when P does not cover the monthly interest). Interest paid is the interest on that payoff schedule. Investing instead = P a month for those months at the expected return ÷ 12, compounded monthly, while the balance B gets no payments and grows to B × (1 + r)n ("debt still owed"). Net expected edge from investing = investment value − debt still owed − the cash left over in the payoff plan's final month = P × [((1 + i)n − 1) ÷ i − ((1 + r)n − 1) ÷ r], where i = return ÷ 12. The investing path assumes no required payment on the debt; a required minimum payment M would scale that edge by (P − M) ÷ P, and the tool does not model it. Verdict: pay the debt if its rate is more than 1 point above the return, invest if the return is more than 2 points above the rate, otherwise "close". The chart shows the two rates side by side.
- Job offer: NPV = signing bonus − relocation + the sum, for each year at the new job, of (salary difference − 12 × extra monthly costs) ÷ (1 + d)year. An NPV within 50 cents of $0 reads "zero"; otherwise over $10,000 reads "worth it", above $0 "marginal" and below $0 "negative". The cumulative gain at 1, 3 and 5 years is undiscounted (bonus − relocation + that many years of net annual benefit) and always uses 1, 3 and 5 years, whatever tenure you enter; the chart plots the same undiscounted running total month by month for 60 months. Break-even tenure = (relocation − bonus) ÷ net annual benefit × 12, rounded up to months, with a note when that runs past the years you entered; 0 when the bonus covers relocation and the net annual benefit is $0 or more; "n/a" when the bonus covers relocation but the net annual benefit is negative (the hint gives the last month you are still ahead); "never" when the bonus does not cover relocation and the net annual benefit is $0 or less.
- Lump sum: NPV = annual benefit × (1 − (1 + d)−n) ÷ d − upfront cost, where n is the years of benefit. IRR comes from 100 rounds of bisection between −99.99% and the larger of 100% and annual benefit ÷ cost (the IRR cannot exceed that ratio); it reads "below −99.99%" when NPV is $0 or less at that floor, and N/A when the cost or the benefit is $0. Break-even = cost ÷ annual benefit, rounded up to whole years, shown as "not within n yr" when that is longer than the benefit lasts and "never" when the annual benefit is $0. The chart plots the undiscounted running total (−cost, then + annual benefit each year) from year 0 to year n.
- Inputs: a blank field, a value below the field's minimum (0, or 1 for years), a year count that is not a whole number, or a year count above the field's maximum (40 for the job, 60 for the lump sum) stops the calculation and names the field; nothing is changed or filled in for you. Rates above 50% are still calculated.
The 7% discount-rate default in the job and lump-sum scenarios is the page's stand-in for long-run real US stock returns: the S&P 500 with dividends compounded at about 10.0% a year from 1928 through 2025[1] while consumer prices rose about 3.0% a year[2], about 6.8% after inflation. Those scenarios hold cash flows flat in today's dollars, so a real rate fits. Card and loan APRs are nominal, so the debt scenario's expected return must be nominal too. Its 7% default is a conservative nominal assumption set by the site, not a published figure; it sits below the roughly 10.0% nominal average[1], which tilts the default comparison toward paying the debt. Taxes, raises and benefits are not modeled. Verify the methodology or inspect the source code in your browser's dev tools. A result too large for the browser to represent (for example a very high return compounded over thousands of months) shows as “too large to show” instead of a number; the verdict still compares the two rates.
Where to go from here
Sources
Bracketed numbers in the text link to these sources. Figures, rates and rules change: check each source’s date before acting on it.
- NYU Stern (Aswath Damodaran), Historical Returns on Stocks, Bonds and Bills: 1928-2024 (the table runs through 2025: $100 at the start of 1928 grew to $1,157,599 by the end of 2025). Checked 2026-09-26. ↩
- U.S. Bureau of Labor Statistics via FRED, Consumer Price Index for All Urban Consumers: All Items in U.S. City Average (CPIAUCNS) (17.3 in December 1927, 324.054 in December 2025). Checked 2026-09-26. ↩
Calculators are educational estimates, not financial advice. Disclosures · How pages are reviewed