MIRR Calculator (Modified Internal Rate of Return)
Calculate the modified internal rate of return (MIRR) of a series of cash flows with separate finance and reinvestment rates — the same result as Excel’s MIRR — and compare it with the IRR and NPV.
How it works
MIRR = [FV of positive cash flows at the reinvestment rate ÷ PV of negative cash flows at the finance rate]^(1/n) − 1 · FV = Σ CFₜ⁺ × (1 + r)^(n − t) · PV = Σ |CFₜ⁻| ÷ (1 + f)^t · n = number of periods
The ordinary IRR assumes every cash flow a project throws off is reinvested at the IRR itself, which overstates attractive projects and can give several answers when cash flows change sign more than once. The modified IRR fixes both problems: outflows are discounted at the finance rate (what the money costs) and inflows are compounded to the end at a realistic reinvestment rate, leaving one unique rate. This calculator uses the same method as Excel’s and Google Sheets’ MIRR function. Periods can be years, quarters or months; the MIRR is per period.
Worked example
An investment of 120,000 returns 39,000, 30,000, 21,000, 37,000 and 46,000 over five years. Compounding the inflows at 12% to year 5 gives 217,297 and the outflow’s present value at 10% is 120,000, so MIRR = (217,297 ÷ 120,000)^(1/5) − 1 = 12.61%, exactly what Excel’s MIRR returns. The plain IRR is 13.07% and the NPV at 10% is 9,859.
Sources: Microsoft Support — MIRR function · Investopedia — Modified Internal Rate of Return (MIRR)
Frequently asked questions
Why is MIRR usually lower than IRR?
Because the reinvestment rate is usually lower than the IRR. When cash flows are reinvested at a realistic rate rather than at the project’s own IRR, the overall return comes down.
What finance and reinvestment rates should I use?
A company typically uses its cost of capital (WACC) for both. An individual might use a loan rate as the finance rate and the expected return on savings or investments as the reinvestment rate.
Does MIRR give the same answer as Excel?
Yes. Excel’s MIRR(values, finance_rate, reinvest_rate) uses exactly this formula; the example matches Microsoft’s documentation.
When does MIRR matter most?
For projects with non-conventional cash flows (several sign changes), which can have multiple IRRs or none, and when comparing projects of different size and timing.
Related calculators
Educational estimate, not investment, trading or tax advice. Brokers, exchanges and data providers use their own conventions, fees and figures — confirm with your broker, the exchange’s documentation or a licensed adviser before acting.