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Customer Lifetime Calculator
Estimate customer lifetime (months) from monthly churn rate (a simple approximation).
Customer lifetime is an intuitive way to translate churn into a time horizon: how long a typical customer stays active before churning.
This calculator uses a constant monthly churn shortcut. It also reports median lifetime and retention after a chosen horizon to help you reason about compounding.
Prefer an explanation- Read the guide.
Need definitions- Browse the glossary.
Customer lifetime: definition, formula, and how to estimate itARR growth rate: how to measure recurring momentumARR guide: meaning, formula, MRR, bookings, and growthARR vs MRR: definitions, formulas, and how to convert
%
Used to compute retention after N months (for example 12).
Tip: you can type commas (e.g., 10,000).
Example
Using the default inputs, the result is:
33.3 months
- Monthly churn rate
- 3%
- Horizon (months)
- 12
How to calculate
- Enter monthly churn rate (customer churn, not revenue churn).
- Review expected lifetime (1 / churn) as a quick estimate.
- Review median lifetime and retention at a horizon (for example 12 months).
- Use cohort curves for precision when churn changes by tenure.
Formula
Customer lifetime (months) ~= 1 / monthly churn rate
- Assumes churn is roughly constant over time (often untrue early vs late).
- Useful as a planning shortcut; cohort curves are more accurate.
Benchmarks
- Small changes in churn can create large changes in lifetime because churn is in the denominator.
- Median lifetime is often more conservative than 1/churn when churn is not very small.
- Pair lifetime with gross margin to estimate LTV and with CAC to estimate payback feasibility.
FAQ
Why is this only an estimate-
Churn usually changes by tenure (early churn is higher). This formula assumes churn is constant, so it should be used as a quick approximation or compared across segments consistently.
Common mistakes
- Mixing monthly churn with annual ARPA or annual retention (unit mismatch).
- Using NRR/GRR as if it were customer churn (different denominators).
- Assuming churn is constant when early churn is much higher than steady-state churn.
Related calculators
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CAC Calculator
Calculate Customer Acquisition Cost (CAC) from total acquisition spend and new customers.
SaaS Metrics
Fully-loaded CAC Calculator
Calculate fully-loaded CAC by including paid spend plus sales & marketing costs (salaries, tools, and other acquisition costs).
SaaS Metrics
LTV Calculator
Estimate customer Lifetime Value (LTV) using ARPA, gross margin, and churn rate.
SaaS Metrics
LTV Sensitivity Calculator
See how gross profit LTV changes as churn and gross margin vary (simple 3x3 sensitivity).
SaaS Metrics
LTV:CAC Calculator
Compute LTV:CAC ratio and CAC payback using ARPA, gross margin, churn, and CAC.
SaaS Metrics
CAC Payback Period Calculator
Estimate how many months it takes to recover CAC (months to recover CAC) using gross profit.
Quick checks
- Keep time units consistent (monthly vs annual) across inputs and outputs.
- Segment by cohort/channel/plan before trusting a blended average.
- Use the related guide to avoid common definition and denominator mismatches.