MIRR Function in Excel: IRR With Realistic Reinvestment

MIRR Function in Excel: IRR With Realistic Reinvestment featured illustration

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⏱ 2 min readUpdated 5 October 2026

FinancialLevel: ExpertAvailable in: Excel 2007+

In this article
  1. Syntax
  2. Examples
  3. Example 1
  4. MIRR in practice
  5. Where you will use it
  6. Worked example
  7. Mistakes people make
  8. Related functions
  9. Continue learning

MIRR fixes IRR’s optimistic assumption that cash is reinvested at the IRR itself, using separate finance and reinvestment rates.

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Syntax

=MIRR(values, finance_rate, reinvest_rate)
Argument What it means
finance_rate Cost of borrowing.
reinvest_rate What you actually earn on cash received.

Examples

Example 1

=MIRR(B2:B7, 10%, 7%)

Project return assuming 10% funding cost and 7% reinvestment.

MIRR in practice

Where you will use it

  • Project return with realistic reinvestment rate
  • More conservative than IRR
  • Compare projects

Worked example

CaseFormulaResult
1=TEXT(MIRR(INDEX($H$1:$L$3,A2,0),0.1,0.08),"0.00%")13.65%
2=TEXT(MIRR(INDEX($H$1:$L$3,A3,0),0.1,0.08),"0.00%")11.29%
3=TEXT(MIRR(INDEX($H$1:$L$3,A4,0),0.1,0.08),"0.00%")9.75%

Results calculated in Excel.

Mistakes people make

MistakeWhat to do instead
RatesFinance rate for borrowing, reinvest rate for returns
No negative flow#DIV/0!

IRR · XIRR

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📎 Practice files for this article

  • 📗
    Practice workbook: Financial: EMI, SIP, NPV, IRR, depreciation23 tasks on realistic sales data — type your formula, the Check column turns green when it is right. Answers sheet included.
    ⬇ XLSX · 35 KB

Free to use for learning. Files with macros (.bas) are plain text — import them with Alt+F11 → File → Import File, and always test on a copy.

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