Investing
Present Value Calculator
A dollar in the future is worth less than a dollar today, because today's dollar can be invested. Present value answers 'what is a future payment worth now?' Enter the future amount, a discount rate, and the years to see its value in today's money.
Formula shown below · Tested against worked examplesHow we verify
The annual return you could otherwise earn — often a market return or your cost of capital.
Present value: $6,139
Present value
$6,139
What that future amount is worth in today's dollars.
- Future amount
- $10,000
- Discount for waiting
- $3,861
Value lost to time and opportunity cost.
Compare scenariosTry three values of one input
| Future amount | |||
|---|---|---|---|
| Present value | $5,525 | $6,139+$614 | $6,753+$1,228 |
| Future amount | $9,000 | $10,000+$1,000 | $11,000+$2,000 |
| Discount for waiting | $3,475 | $3,861+$386 | $4,247+$772 |
Every other input stays at the value you set above — currently $10,000 for future amount. Differences are measured against the first column.
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How this calculator works
Present value = future amount ÷ (1 + discount rate)^years. The discount is the future amount minus its present value — the cost of waiting. At zero years the present value equals the future amount.
This discounts a single future lump sum. For a stream of payments (an annuity), each payment is discounted and summed — see the related calculators for growing balances and loan present values.
Formula
PV = FV ÷ (1 + r)ⁿ- PV
- Value today
- FV
- Amount received in the future
- r
- Discount rate per period, as a decimal
- n
- Number of periods
The discount rate is the return you could otherwise earn, so it is a judgement rather than a market quote — and the result is highly sensitive to it. Raising the rate lowers the present value quickly over long horizons.
What this assumes
- The discount rate you enter, held constant across the whole period.
- The future amount is treated as certain. Uncertain cash flows deserve a higher rate, and the choice is a judgement.
- Inflation is included only if the rate you enter is nominal rather than real.
What changes this number
- Discount rate
- Dominant over long horizons. Doubling it can more than halve the present value.
- Time
- Each period compounds the discount, which is why very distant money is worth strikingly little today.
- Certainty
- Not modelled directly. It should be reflected in the rate you choose.
A worked example
Take the $10k in 10 years at 5% scenario. These figures are produced by the calculator above, not written alongside it, so they always match what the tool returns.
What you enter
- Future amount
- $10,000
- Discount rate
- 5%
- Years from now
- 10 years
What it returns
- Present value
- $6,139
- Future amount
- $10,000
- Discount for waiting
- $3,861
Sources
This calculator uses no external data — the result follows entirely from the formula above and the values you enter, so there is nothing to cite beyond the arithmetic.
Calculator last reviewed August 8, 2026. How we verify
Try an example
Frequently asked questions
What is present value?
Present value is what a future sum of money is worth today, given a rate of return you could otherwise earn. Because money can grow if invested, a payment you'll receive later is worth less than the same amount now. $10,000 in ten years at a 5% discount rate is worth about $6,139 today.
How do you calculate present value?
Divide the future amount by (1 + rate) raised to the number of years: PV = future ÷ (1 + r)^n. It's the reverse of compounding — instead of growing money forward, you discount it backward. The higher the rate or the longer the wait, the smaller the present value.
What discount rate should I use?
Use the return you could realistically earn on the money instead — your 'opportunity cost.' That might be a safe rate like Treasury yields for low-risk comparisons, or an expected market return (say 6–8%) for investments. A higher discount rate reflects higher risk or better alternatives, and lowers the present value.
Why does present value matter?
It's the foundation of comparing money across time — deciding between a lump sum now or payments later, valuing a lottery payout, pricing a bond, or evaluating an investment. Any time you weigh money you'd get at different times, converting everything to present value makes the comparison fair.
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Disclaimer: DayCents provides this calculator for educational purposes only. Results are estimates based on your inputs and the stated assumptions — they are not financial advice, a quote, or an offer of credit. Consult a qualified financial professional before making major money decisions.