Present Value Calculator
Calculate present value using the time value of money. Discount future cash flows, evaluate investments with NPV and IRR, and see how inflation erodes purchasing power over time.
Try another scenario
How to Use This Calculator
Present Value tab
The default tab. Enter a future value (the amount you expect to receive), a discount rate (your required return or opportunity cost), and the number of years until you receive it. The calculator shows the present value — what that future amount is worth in today's dollars. Expand "More options" to change the compounding frequency (annual, semi-annual, quarterly, monthly).
NPV Calculator tab
Enter your initial investment (the upfront cost) and up to 10 annual cash flows. The calculator computes the Net Present Value (NPV), Internal Rate of Return (IRR), profitability index, and both simple and discounted payback periods. Use this to evaluate business investments, rental properties, or any project with uneven cash flows.
Inflation Adjusted tab
Enter today's amount (annual spending, salary, or retirement target), an inflation rate, and the number of years. See how much you will need in future dollars to match today's purchasing power, and how much today's dollars will actually buy in the future. Essential for retirement planning and long-term financial goals.
Share your result
Every input is encoded in the URL. Click Share to send your exact scenario to a financial advisor, business partner, or colleague.
The Formulas
PV = FV / (1 + r/m)^(n × m)
Where FV = future value, r = annual discount rate, m = compounding periods per year, n = years
Net Present Value:
NPV = -C0 + C1/(1+r) + C2/(1+r)^2 + ... + Cn/(1+r)^n
Where C0 = initial investment, Cn = cash flow in year n, r = discount rate
IRR: The rate r where NPV = 0 (solved via Newton's method)
Inflation adjustment:
Future equivalent = Today's amount × (1 + inflation)^n
Purchasing power = Today's amount / (1 + inflation)^n
The discount rate represents the opportunity cost of money — what you could earn by investing elsewhere. A higher discount rate means future cash flows are worth less today. Common rates by context:
- Risk-free: 10-Year Treasury yield (~4.5% in 2026)
- Personal finance: 6-8% (stock market real returns)
- Corporate projects: 8-12% (weighted average cost of capital)
- Real estate: 6-10% (cap rate or required return)
- Venture capital: 20-30% (high-risk, high-return)
Example
Maria — Retirement Planning, Age 35
Maria earns $95,000 and wants to retire at 65 with $80,000/year in today's purchasing power. She assumes 3% inflation and uses an 8% discount rate (her expected investment return). Here is how time value of money applies to her plan:
What will she need annually at 65?
What is a $500,000 inheritance in 10 years worth today?
Should she invest $40,000 in a rental unit?
The rental has a positive NPV of $23,436 and an IRR of 21.7%, well above her 8% discount rate. This project creates value. Meanwhile, she will need almost $194,000/year in 30 years just to match today's $80,000 — a reminder that inflation compounds relentlessly.