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Customer Lifetime Value (LTV / CAC) Calculator

Calculate Customer Lifetime Value (LTV), LTV to CAC ratio, payback period, and unit economics health for growth.

Quick Scenarios
Average dollar amount spent per purchase or monthly subscription.
How many times a customer buys in one year (use 12 for monthly subscriptions).
How many years the average customer stays active.
Gross profit percentage after product fulfillment costs.
Total sales and marketing cost to acquire one paying customer.

LTV:CAC Ratio is 4.03x (Healthy (3x - 5x)).

Each customer generates $1,008.00 in lifetime gross profit against a $250.00 acquisition cost, paying back acquisition in 8.9 months.

Customer Lifetime Value (LTV) $1,008.00
LTV to CAC Ratio 4.03x
CAC Payback Period 8.9 months
Net Profit per Customer (LTV - CAC) $758.00
Annual Revenue per Customer $480.00
Gross Lifetime Revenue $1,440.00

GetCalcu Methodology & Editorial Standards

Every calculation formula on GetCalcu is peer-reviewed against official industry standards (CFPB, IRS Title 26, NIST, ISO 80000, and CDC guidelines).

Reviewed by: GetCalcu Editorial & Mathematical Board
Last Verified: September 2026
Accuracy Policy: In-browser deterministic computation
Feedback: Report an issue

Understanding LTV:CAC and SaaS Unit Economics

Customer Lifetime Value (LTV) measures the net profit a single customer contributes over their entire relationship with your company.

The 3:1 Rule for LTV:CAC

A 3:1 ratio (LTV = 3x CAC) is widely considered the golden benchmark. Below 1:1, you lose money on every customer. Above 5:1, you may be underinvesting in marketing and leaving market share on the table.

CAC Payback Period

The payback period tells you how many months of customer revenue are required to recoup the upfront sales and marketing acquisition cost.

How to Use the Customer Lifetime Value (LTV / CAC) Calculator

  1. Step 1: Enter your Average Order Value (AOV) and annual purchase frequency.
  2. Step 2: Set expected customer retention lifespan in years.
  3. Step 3: Add gross margin percentage and Customer Acquisition Cost (CAC).
  4. Step 4: Analyze your LTV:CAC ratio and payback timeline.
Formula: LTV = (AOV × Frequency × Lifespan) × Gross Margin % | LTV:CAC = LTV ÷ CAC | Payback = CAC ÷ Monthly Gross Profit

Real-World Worked Examples

B2B Software SaaS

Input: $150/mo, 80% Margin, 3 Yr Lifespan, $1,200 CAC

Result: LTV: $4,320 | Ratio: 3.6x | Payback: 10.0 mo

Frequently Asked Questions

What is a good CAC payback period?

For B2B SaaS, under 12 months is considered excellent. For B2C and e-commerce, payback should ideally occur within the first purchase or within 6 months.