Present Value Calculator
Enter a future amount, discount rate, and number of periods to find out what that future sum is worth in today’s dollars.
What Is Present Value?
Present value (PV) answers a simple but important question: what is a sum of money you’ll receive in the future actually worth today? Because money available now can be invested and grow, a dollar today is worth more than a dollar promised years from now — present value quantifies exactly how much more.
The Formula
Present value is calculated as PV = FV / (1 + r)^n, where FV is the future value, r is the discount rate per period (as a decimal), and n is the number of periods until the amount is received. The discount rate typically reflects the return you could earn elsewhere or the cost of capital.
Why It Matters
Present value is the foundation of comparing cash flows across time — it’s used to evaluate investments, loan payoffs, settlements, and retirement planning by converting future dollars into an equivalent value today.
- For general financial planning and educational purposes only.
- Choosing an appropriate discount rate significantly affects the result; this tool does not recommend one.