Present value calculator
Discounting is compounding run backwards: money later is worth less than money now.
%
Present value
13 959.87
- Amount discounted away
- 11 040.13
- Discount factor
- 0.558 395
Show the working
- Future amount = 25 000
- Annual discount rate = 6
- Years away = 10
- Compounding = 1
- i = 6 / 100 / 1 = 0.06
- n = 10 * 1 = 10
- Present value = 25 000 / (1 + 0.06)^10 = 13 959.9
- Amount discounted away = 25 000 - 13 959.9 = 11 040.1
- Discount factor = 1 / (1 + 0.06)^10 = 0.558 395
Values are shown to six significant figures here; the arithmetic itself runs on exact fractions and is only rounded where a number is printed.
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The formula
- PV = FV / (1 + i)^n
This is arithmetic, not financial advice. Real products carry fees, tax treatment and terms that no formula captures.