Find what a future sum of money is worth today, discounted at a given rate.
How the present value calculator works
Present value tells you how much a future amount is worth now, given that money can earn a return. Enter the future value, a discount rate and the number of years.
It’s a core idea in finance for comparing amounts across time.
How to use it
- Enter the future value.
- Enter the discount rate and years.
- Read the present value.
The calculation
present value = future value ÷ (1 + rate)^years
Worked example
Take the starting scenario, a future value of 10,000. That gives a present value of $7,472.58. Alongside it, Discount factor comes out at 0.7473. Change any field and every figure updates as you type.
FAQ
What is present value?
The current worth of a future sum, reduced (discounted) because money available now could be invested to grow.
What discount rate should I use?
Often the return you could earn elsewhere, or a required rate of return. Higher rates shrink the present value.
How does it relate to future value?
They’re inverses — future value grows a present sum forward; present value discounts a future sum back.