⏪ Present Value Calculator
Discount future cash flows to find what they are worth in today's dollars. Use the single amount tab for a lump sum, or the annuity tab for a series of regular payments.
Present Value Formulas
Single Amount
Ordinary Annuity
Annuity Due
Real-World Example
Receive $10,000 in 5 years with a 8% discount rate:
Steps to Use
- Choose Single Amount for a lump sum or Annuity for periodic payments.
- Enter the future value (or payment amount) and the discount/interest rate.
- Set the time period and compounding frequency.
- Click Calculate to see the present value and discount amount.
Frequently Asked Questions
Present value (PV) is the current worth of a future sum of money or stream of cash flows, given a specified rate of return. Money available today is worth more than the same amount in the future because it can be invested and earn a return.
The discount rate depends on the risk of the cash flows and your opportunity cost of capital. Common benchmarks: risk-free rate (government bonds) 4–5%, corporate bonds 6–8%, equity investments 10–12%, and startup/venture investments 20–30%.
Present Value (PV) tells you what a future sum is worth today. Future Value (FV) tells you what a current sum will be worth later. They are inverses: PV discounts future amounts back in time, while FV projects current amounts forward.
Net Present Value (NPV) is the sum of all discounted future cash flows from a project or investment, minus the initial investment cost. A positive NPV means the investment is expected to add value; a negative NPV means it destroys value at the given discount rate.
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