Present Value Calculator - Future Money Value Today

Calculate the current worth of a future sum of money or stream of cash flows given a specified rate of return. All values are adjusted for the time value of money.

Calculation Parameters

$
$1,000$50,000$100,000
%
0%10%20%
1 year15 years30 years

Calculation Summary

Type:
Lump Sum
Future Value:
$10,000.00
Interest Rate:
5.00%
Time Period:
5 years

Calculation Results

Our Present Value Calculator is a unique online tool that lets you assess the present value of a future amount of money or future cash flows. If you need to know how much your money today will be worth in the future, or how to calculate the discounted amount of a future investment, you can use this calculator. Otherwise, the Present Value Calculator would be interesting if you are a business owner, investor, or identifying your personal finances, recognizing the present value of your future cash helps make better financial decisions.

Present Value Calculator

What Is a Present Value Calculator?

Present Value Calculator is a tool which estimates for you the value of today’s money based on a future amount of money, interest rate, and time period. Present Value (PV), is the value of future amount of money, discounted for a specified rate, over a known period.

Using this tool you can calculate the current worth of a future investment or cash inflow today, while factoring in the inflation, interest rates, and time value of money.

Formula Used:

PV =FV /(1 + r)n

Where:

PV = Present Value
FV = Future Value
r = Interest Rate (per period)
n = Number of Periods

Features of Our Present Value Calculator

1.
Accurate Calculations - Gain precise present value results in seconds.
2.
Customizable Inputs - Provide your future value amount, interest rate, and time period for corresponding calculations.
3.
Graphical Visualization - See how your future value will grow over time using a line chart or bar graph.
4.
Investment Planning - We provide information that allows for informed choices concerning savings, investments, or making a loan payment.
5.
Simple and Provides Free - An easy-to-use tool that anyone can use whenever they need it.
6.
Supports Lump Sum & Annuity - Choose between a single future payment or multiple periodic payments.

Why use a Present Value Calculator?

Over time as inflation and interest rates change money actually loses its value, which refers to the time value of money. If you are either anticipating receiving or making a payment of a certain amount, it's valuable to know it's present value because that knowledge will help you:

Make informed choices regarding investments.
Compare financial opportunities.
Plan your retirement and savings goals.
Assess potential loan payments and mortgage options.
Understand how inflation influences your wealth.

The Present Value Calculator saves time and makes it easier to confirm your calculations are always correct.

How to Use the Present Value Calculator

1.
Enter Future Value (FV): Describe the amount of money you expect or will pay out in the future.
2.
Enter Annual Interest Rate: Add in the discount (or expected return).
3.
Set the Time Period: Enter the number of years (or periods) until you receive the future value.
4.
Select Calculation Type: Select this based on your cash flow needs.
5.
View Instant Results: The calculator quickly displays your Present Value, Total Interest, and Future Value with a graphical breakdown.

Example Calculation

If you expect to receive $10,000 in 5 years and are going to earn an annual interest rate of 5%, the Present Value Calculator is going to calculate that the present value of that future amount is $7,835.26. This means that you need to invest $7,835.26 today at 5% interest in order to receive $10,000 in 5 years.

Advantages of Using a Present Value Calculator

1.
Save time calculating by using an automated calculator.
2.
Quickly compare investment opportunities.
3.
Better use for businesses calculating return on investments or projected inflowing cash.
4.
Use for personal finance planning or retirement savings assessments.
5.
Free! You can access this calculator for free on a desk top, tablet or smart phone.

The Present Value Calculator is an important financial planning resource for anyone interested in making informed investment decisions, comprehending the time value of money, and comparing cash flows in the future. If you are contemplating where to allocate your savings for retirement, comparing investments, or determining the payment on a loan, this calculator can help you derive a conclusion on the value of future money today.

Try our Present Value Calculator today and take the guess work out of your financial future!

FAQs

Present value is the current value of a future sum of money that is discounted to a present value, based on a defined rate of interest. This measure of present value will give you an understanding of money in today's value.

Present Value is important because due to inflation and opportunity cost, money loses value over time. The Present Value allows individuals and firms to make better financial decisions.

Sure! You can use this calculator to find out the present value of future loan payments and/or mortgage repayments.

Future Value provides an indication of how much an investment would grow to in the future, whereas Present Value provides the value of a future amount of money in the present day.

Absolutely! Our Present Value Calculator is 100% free and can be accessed online at any time to help you plan your investments and your savings.