The formula this calculator uses
Present Value Calculator
PV = FV ÷ (1 + r)^t
where r = annual discount rate, t = years
Example: $100,000 in 10 years at 7% discount → PV ≈ $50,835
Time value of money
Present-value calculations let you compare cash flows that occur at different times on a common basis. They are fundamental to investment appraisal, loan pricing, and retirement planning.
How to use this calculator
- Enter the required values in the fields above.
- Results update automatically as you type.
- Adjust any input to explore different scenarios.
Frequently asked questions
What is present value?
Present value is the current worth of a future cash amount after discounting at a chosen rate of return.
Why discount future money?
Money available today can be invested and grow; therefore a dollar tomorrow is worth less than a dollar today.
What discount rate should I use?
Common choices are expected investment return, cost of capital, or inflation rate, depending on the decision.
Is this the same as NPV?
Present value of a single sum is the core of net present value (NPV), which sums many discounted cash flows.