Present Value Calculator
Introduction to Present Value and the PV of a Single Amount Calculator
The Accurate Present Value Calculator answers the question, "What is today's value of an amount due at some date in the future, assuming "X" rate of return?"
- You select any start and end date.
- Accurate for legal settlements.
Would you prefer to receive $10,000 today, or to wait one year to receive $10,000?
This is not a trick question. In this example, most people prefer to receive $10,000 today instead of waiting one year.
However, what if you are offered $9,000 today or $10,000 in one year? How would you determine which choice is better?
That is the purpose of a present value (PV) calculator—it calculates today’s value of a future amount. You can then use this information to decide whether to accept (or offer) the amount today, or to wait and accept (or offer) the future amount.
How does the calculator determine the present value (PV)?
The key to understanding the PV calculation is that there is no single “correct” present value. There is only an “accurate” present value based on the assumptions you use.
What does that mean?
Read more below…