Present Value Calculator
Future money, todays value.
Present Value Calculator
PV = FV / (1 + r)^n
Calculated instantly
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What This Calculator Does
The Present Value Calculator discounts a future amount back to what it is worth today. A dollar today is worth more than a dollar tomorrow because of inflation and the opportunity to invest it. This calculation is fundamental to bond pricing, retirement planning, and comparing financial options.
How It Works
Present value equals the future amount divided by (1 + discount rate) raised to the number of years. A higher discount rate reduces the present value more.
Example
$50,000 received in 5 years at 5% discount rate is worth $39,176 today. At 10%, the same future amount is worth only $31,046.
Formula
PV = FV / (1 + r)^nReading the Results
Present Value
What the future amount is worth in todays dollars.
Frequently Asked Questions
Why is future money worth less today?
Because of inflation and opportunity cost. Money you receive later loses purchasing power and misses investment returns.
What discount rate should I use?
Common choices are your expected investment return (8-10%) or inflation rate (3-4%) depending on the context.
Is present value the same as net present value?
No. Net present value (NPV) subtracts the initial investment cost from the present value of future cash flows.