Find today's worth of any future sum — instantly
Inputs
The lump sum you will receive in the future
Your required rate of return or opportunity cost
Result
Value Comparison
Receiving $10,000.00 in 5 years is worth only $6,805.83 today at 8.00%/yr.
Discount Schedule
Step-by-step view of how the future value is discounted back to today.
How Present Value Works
Present Value (PV) answers: "How much is a future sum worth in today's dollars?" Money today is worth more than the same amount in the future because it can be invested and earn a return. The discount rate represents your opportunity cost — the return you could earn elsewhere.
PV = FV ÷ (1 + r/m)^(m × t)
FV = future value · r = annual rate · m = compoundings/year · t = years
Disclaimer: This calculator is for educational and illustrative purposes only. Real investment returns are not guaranteed. Consult a qualified financial advisor before making investment or financial planning decisions.
The present value calculator tells you what a future sum of money is worth in today's dollars. Using the time value of money principle — that a dollar today is worth more than a dollar tomorrow — it discounts any future amount back to the present using your chosen annual discount rate, time horizon, and compounding frequency. Essential for investment analysis, financial planning, and comparing cash flows.
Present value (PV) is the current worth of a future sum of money, discounted at a specific rate of return. It answers the question: how much would I need to invest today, at a given rate, to receive a specific amount in the future?
The discount rate represents your opportunity cost — the return you could earn on an alternative investment of similar risk. Common choices are the expected stock market return (~7-10%), your cost of capital, a risk-free rate (like Treasury yields), or your personal required rate of return.
More frequent compounding (e.g., monthly vs. annually) results in a slightly lower present value at the same stated annual rate. This is because more frequent compounding means the effective annual rate is slightly higher, so the discount applied over time is marginally greater.
PV = FV ÷ (1 + r/m)^(m × t), where FV is the future value, r is the annual discount rate as a decimal, m is the number of compounding periods per year, and t is the time in years.