Payback calculator

When does it pay off

See how long a one-off cost, such as a heat pump, a new appliance or a switch to another plan, takes to pay for itself through lower running costs, and what you gain or lose over the years you choose.

New to this? See how it works ↓

Your numbers · replace with your own

Optional

Your result

—

Saving per month
—
Saving in the first year
—
Net benefit over the period
—

An illustration based on the numbers you entered, not a forecast and not advice.

Assumptions & limits

  • Savings are counted at today's prices unless you enter a yearly cost increase; the same increase is applied to both the old and the new cost.
  • The upfront cost is treated as paid in full today; financing interest isn't included.
  • Maintenance, repairs and changes in usage are included only if you fold them into the recurring costs.

How it works

Paying now to pay less later

Many purchases cost more up front and less to run: a heat pump, an efficient appliance, a cheaper plan with a setup fee. The question is when the lower running cost has paid back the extra you spent. Enter what you pay up front, any rebate, what you pay today and what you would pay after the change.

The calculator works out the saving in the first year, then adds up the saving year after year. Payback is the first year in which the running total reaches the net upfront cost, with that last year split into months. If you expect costs to rise, a yearly increase is applied to both the current and the new cost, so the gap between them grows. A resale value at the end of the period is added to the benefit.

The result is shown as a payback time, a net benefit over the period you chose and a year-by-year table, so you can see how far short or ahead you are at every point. It does not include financing interest, repairs or changes in how much you use the item unless you fold them into the recurring costs. Nothing you enter is stored or sent anywhere.

Formula

net_cost       = upfront cost − rebate
k              = billing periods per year (weekly 52, monthly 12, quarterly 4, yearly 1)
saving_year_1  = (current − new) × k
saving_year_t  = saving_year_1 × (1 + growth)^(t − 1)
cumulative(t)  = saving_year_1 + … + saving_year_t

payback        = first year T where cumulative(T) ≥ net_cost
                 payback_years = (T − 1) + (net_cost − cumulative(T − 1)) ÷ saving_year_T
                 with no growth: net_cost ÷ saving_year_1

net_benefit    = cumulative(years) − net_cost + resale value

Worked example

A $800 upgrade that cuts a $60 bill to $20

You pay $800 once and your monthly bill drops from $60 to $20. You look at the next five years.

Worked example, step by step
Step Result
Saving per month $60 − $20 = $40
Saving per year $40 × 12 = $480
Payback $800 ÷ $480 = 1.67 years, or 1 yr 8 mo
Net benefit over 5 years $480 × 5 − $800 = +$1,600

Common questions

What counts as the upfront cost?

Whatever you pay once to get the saving: the purchase, the installation and any fees. A rebate or incentive is entered separately and subtracted. If the rebate is larger than the cost, it is capped at the cost.

Why does the payback change when I add yearly cost increases?

When energy or service prices rise, the gap between the old and the new cost grows, so later years save more and payback arrives sooner. The calculator applies the same percentage increase to both costs.

What if the new cost is not lower than the current one?

Then there is no saving to recover the upfront cost from. The calculator says it never pays off at these costs, hides the year-by-year table and shows the loss as a negative net benefit.

What does the resale value do?

A resale or salvage value at the end of the period is added to the net benefit, because you get that money back. It does not change the payback time, and it is capped at the upfront cost.

Other ways to ask what it costs you

What a price increase costs you How much a price rise costs per month, per year and over the years ahead. Open calculator → Cost per unit and per use Big pack or small, buy or subscribe — which is cheaper once you divide it out. Open calculator → What it costs to run What an appliance or a habit costs per month and per year, and what a replacement saves. Open calculator →

Updated Our methodology

The latest, explained

Tech

Ad Code in Some Android Apps Shares Your Location. Here's What to Recheck

An August 2026 EFF investigation found ad code inside popular Android apps passing on users' location whenever the app itself had location access. That makes location the first permission to revisit, but not the only one. This guide covers when approximate location (an area of about 3 square kilometers on Android) is enough, what limited contacts and selected-photo access change, why Bluetooth and local network access can reveal where you are, and which Android special access banking malware goes after. It also lists the minimum iOS and Android versions for each control and ends with a step-by-step review using verified settings paths.

Read article
Tech

Siri AI Is Rolling Out. Here's Where Your AI Requests Actually Go

Apple's Siri AI beta, which began rolling out with iOS 27 on September 14, 2026, splits work between the iPhone and Apple's Private Cloud Compute servers, and other assistants mix local and cloud processing in their own ways. This guide maps where Apple Intelligence, Pixel's Gemini Nano and Private AI Compute, Samsung's on-device-only switch, Windows Recall and Click to Do, Alexa and the chat apps send your words. It also explains the tells for each mode, why local storage isn't automatically private, what backs private-cloud promises and how long the cloud apps keep chats.

Read article
Wallet

What Big Banks' Fee Schedules Mean for Your Checking Account

The current fee schedules at Chase, Wells Fargo, Bank of America and U.S. Bank took effect between June 14 and August 10, 2026, and the costs that catch people off guard sit in their conditions rather than on product pages. One day under $1,500 can trigger a $12 to $15 monthly fee at three of the four banks, Zelle and teller deposits may not count toward a deposit waiver, an out-of-network ATM charges twice, and an automatic deposit may not keep an idle account active. Stop-payment orders cost $25 to $35, and flat legal-order fees run $100 to $125 where a bank lists one. A side-by-side table, worked examples and a short self-audit show where each fee sits and how to avoid it.

Read article

Educational content only. Not legal, financial or medical advice.