Calculate return on investment, annualized ROI and what time tracking really pays back – all results update as you type.
How profitable was an investment? Costs, returns and (optionally) its length.
Work backwards from a target ROI to the amount you need back.
Enter your team's norm and what really gets invoiced — the calculator prices the gap. Empty fields use the defaults shown.
Cost of the team = FTE × hours norm × cost rate (per annualized period). Return = total billing hours × revenue rate. Margin is the difference.
AI Time Tracker logs your work automatically and fills your timesheet by itself — the two leaks this calculator just priced, gone. Free for Mac and Windows.
Return on investment measures how much an investment gained relative to its cost:
ROI = (gain from investment − cost of investment) ÷ cost of investment × 100
Buy equipment for $10,000 and sell the extra output it produced over its life for $13,500: net gain is $3,500, and ROI is 35% — $3,500 divided by $10,000. A negative value means the return did not cover the cost.
ROI is a quick filter, not a verdict. It answers one question well: did this investment earn more than it cost, in percent? It is quiet about how long the money was locked in, which is why the classic tab also shows the annualized figure when you give it a period.
A 60% ROI sounds better than a 20% ROI — unless the first took five years and the second took six months. The annualized formula levels the field by answering: at what rate did this investment grow per year?
Annualized ROI = (returned ÷ invested)1 / years − 1
Example: $10,000 → $13,500 over 2 years is ROI of 35%, but an annualized return of 16.2%. The same $10,000 → $13,500 over 6 years is still ROI of 35% — but only 5.1% per year. Add a period in the classic tab above and the annualized result appears next to the headline ROI.
Five inputs, five steps. Everything is annualized from the period switcher next to the norm, so the numbers are comparable no matter how your contracts are written:
cost = team size × hours norm × periods per year × cost rate. Three FTE on a 40 h/week norm work 3 × 40 × 48 = 5,760 hours a year; at a $35 cost rate that is $201,600 — the investment side of the ROI.
revenue (return) = billing hours (whole team) × periods per year × revenue rate. If only 90 of the 120 norm hours get billed, the team earns 4,320 hours × $80 = $345,600 — the whole amount the investment pays back. Cost rate and revenue rate stay separate on purpose: what an hour costs you (salary, overhead) is never the same as what an hour earns you.
margin = return − cost. $345,600 − $201,600 = $144,000 of net profit. As a percentage of revenue it is 41.7% (margin ÷ revenue × 100).
ROI = margin ÷ cost × 100 — net gain over invested cost. The example team returns 71.4% on the money invested in it.
payback = cost ÷ (revenue ÷ 12). How many months of billing cover a full year of team cost: here 7.0 months — the last five months of the year are pure margin.
Enter norms as they appear in your contracts: per day (× 240 working days), per week (× 48 working weeks) or per month (× 12). The yearly totals are identical, so results stay comparable.
Whatever period you pick, the calculator always reports on a 12-month basis: cost, revenue and margin are annual amounts, payback is in months, and ROI — being a ratio — is the same no matter which unit you typed in.
The sub-line under the big ROI shows the gap: norm hours minus invoiced hours per year. That is unbilled capacity hiding inside the economics above — hours that exist, cost money, but never reach an invoice. Automatic time tracking narrows exactly this gap, because every logged hour becomes evidence that can be billed.
ROI is popular because it is simple — and its simplicity is its weakness:
For time-tracking ROI specifically, the most common error is undercounting the cost side — forgetting the billable hours that never reach an invoice, or the admin minutes people already spend reconstructing their week. Those hours belong inside the cost side too.
The calculator above works with two clean numbers: what the team costs (norm hours × cost rate) and what it bills (billing hours × revenue rate). The gap between norm and billing is where unbilled work hides — forgotten email threads, unbilled consultations, "quick" tasks nobody logged. A 3-FTE team on a 40 h/week norm billing 90 h/week as a whole team carries a 1,440 h/yr gap: at an $80 revenue rate, that is over $115k of theoretical capacity walking past the invoice.
The gap shrinks when every hour is evidence. The free AI Time Tracker records computer activity automatically and pre-fills the timesheet for one-click approval — so billing hours rise toward the norm, and the margin you just calculated rises with them.
ROI (return on investment) is the percentage of gain an investment produced relative to its cost. Invest $5,000, get $6,000 back — gain $1,000, ROI 20%. Managers use it as a fast screening metric before deeper analysis with NPV or IRR.
ROI = (gain − cost) ÷ cost × 100. If the result is negative, the investment lost money. The one input people forget: hidden costs like maintenance, admin time or subscription fees belong in "cost" too.
ROI tells the total gain relative to cost; annualized ROI tells the gain per year, so investments of different lengths can be compared. 60% over five years is 9.9% annualized; 20% over six months is 44% annualized. The second is clearly better — and only the annualized view shows it.
Multiply your invested amount by (1 + target ROI). With $5,000 and a 30% target, you need to get back $6,500. Reverse conversions like this are what the Target ROI tab computes, including the annualized equivalent when you add a period.
It depends on the asset class and risk. Stock market investors compare against the long-run ~7–10% annual market return, real estate investors often aim for 8–12%, and operational improvements like process tools are usually judged against the company's cost of capital — plus how fast they pay back, which is why the time tracking tab shows payback months too.
ROI divides profit by everything invested (own money and borrowed money); ROE (return on equity) divides profit by only the owners' equity. Leveraged projects can show modest ROI but huge ROE — both numbers alone can mislead without context.
It lifts both sides of the team economics shown above. Automatic logging removes the admin minutes people spend reconstructing their week, and it narrows the gap between hours norm and billing hours — because logged work is evidence that can be billed. Billing hours rise toward the norm, and with them the return, the margin and the ROI you calculated in the time tracking tab.
Yes. Click Print / Save as PDF to print the current tab's results or save them as a PDF file — with assumptions, formulas and the time stamp included.
Your inputs stay in this browser's local storage so the calculator remembers them between visits. Nothing is sent anywhere; TimeCamp does not see them. Reset clears them.
Yes. The free AI Time Tracker runs on Mac or Windows, records project hours automatically and pre-fills the timesheet for one-click approval — removing both the admin minutes and the guess-based billable leak.
This calculator priced your hidden leaks. AI Time Tracker removes them – it logs your hours automatically, fills the timesheet by itself and shows what your workday truly costs. Download the free app for your Mac or Windows computer.
