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Finance · Investing

Present Value Calculator

Find out what a future amount of money is worth in today's dollars after discounting it at your chosen rate. Drag the sliders and the numbers update instantly.

$50,000
$0
5.0%
10 yr
Present value
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PV of lump sum
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PV of payments
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Total discount
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What the future lump sum is worth today, by year

What is present value?

Flat illustration of a large future coin with a backward arrow pointing to a smaller coin today — representing discounting future money back to its present value.
A dollar tomorrow is worth less than a dollar today — present value tells you how much less.

Present value (PV) is the worth in today's dollars of money you'll receive in the future. Because a dollar today can be invested to become more than a dollar tomorrow, future money is always worth less than the same amount now. The formula is PV = FV ÷ (1 + r)n, where r is the discount rate and n is the number of periods.

The role of the discount rate

The discount rate represents the return you could earn elsewhere, or your required rate of return, and it drives the entire result. A higher discount rate shrinks present value because your money could be working harder somewhere else. Choosing the right rate is the most important judgment call in any PV calculation.

Tip: Use present value to compare a lump-sum offer against a payment plan — discount the payments back to today and see which is actually worth more.

Present value vs future value

Future value grows today's money forward; present value pulls tomorrow's money back. Whenever you compare cash flows arriving at different times — a buyout now versus payments later — converting everything to present value puts them on equal footing.

Frequently asked questions

What is present value?
Present value is the current worth of a future sum of money, discounted at a rate that reflects the time value of money. It tells you how much you'd need to invest today to reach that future amount.
What discount rate should I use?
Use the rate of return you could realistically earn on the money, or your required return for the risk involved. Common choices are an expected investment return or, for businesses, the cost of capital. A higher rate lowers present value.
Why is future money worth less today?
Because money you have now can be invested to grow. Receiving $1,000 in ten years is worth less than $1,000 today, since today's $1,000 could grow during those ten years.
How do I value a series of payments?
Discount each future payment back to today by the number of years away it is, then add them up. This calculator does that automatically when you enter an annual payment, treating it as an ordinary annuity.
What's the difference between present and future value?
Present value discounts future money back to today; future value projects today's money forward. They use the same rate and time inputs but move in opposite directions.

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Written & reviewed by Chase Bennett, President of CalcHeadquarters
Every calculator is built from published formulas and authoritative sources, then independently checked for accuracy before it goes live. Last updated July 2026. Read our editorial policy & methodology.