Present Value Calculator
Discount a future sum and future payments back to what they are worth today.
How to use the Present Value Calculator
- Enter a future lump sum you expect to receive.
- Optionally add a future monthly payment stream.
- Enter your discount rate — the return you could earn instead.
- See what those future amounts are worth in today's money.
PV = FV ÷ (1 + r)^n + PMT × (1 − (1 + r)^−n) ÷ r, r monthly, n in months
About the Present Value Calculator
A dollar in the future is worth less than a dollar today, because money in hand can be invested and grow. Present value puts a precise number on that idea: it discounts a future amount back to what it is worth right now, given a rate of return you could otherwise earn. This calculator handles both a future lump sum and a stream of future payments, adding their present values together — the core of the time-value-of-money maths behind loans, investments and valuations.
The discount rate is the lever that drives everything. A higher rate means the future money is worth less today, because you are giving up more growth by waiting for it; a lower rate brings the present value closer to the future amount. Trying a few rates shows how sensitive the answer is, which is exactly why the rate you choose matters so much in any valuation.
Present value is the mirror image of future value: one asks what today's money becomes later, the other what later money is worth now. To grow a sum forward instead, use the future value calculator, and for pure compound growth the compound interest calculator.
Frequently asked questions
What is a discount rate?
It is the annual return you could earn on money if you had it today — often an interest rate or expected investment return. A higher discount rate lowers the present value of future money.
Why is future money worth less today?
Because money you hold now can be invested and grow, while money you must wait for cannot. Present value quantifies that gap by discounting the future amount at your chosen rate.
Can I use it for just a lump sum?
Yes. Leave the monthly payment at zero to discount only a future lump sum, or set the lump sum to zero to value only a stream of future payments.