{
  "slug": "present-value",
  "title": "Present Value Calculator",
  "heading": "Present Value Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/present-value",
  "summary": "What a future sum is worth in today's money.",
  "description": "Present value discounts future money back to today at a required rate of return. It is the maths behind valuing a settlement offer, a pension buyout, or any deal that pays out later.",
  "formula": "PV = FV ÷ (1 + r)^n, plus the discounted value of any recurring payments.",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=present-value",
  "inputs": [
    {
      "id": "fv",
      "label": "Future amount",
      "kind": "number",
      "hint": null,
      "default": 250000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "pmt",
      "label": "Annual payment received",
      "kind": "number",
      "hint": null,
      "default": 0,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "rate",
      "label": "Discount rate",
      "kind": "number",
      "hint": null,
      "default": 6,
      "unit": "%",
      "min": 0,
      "max": null
    },
    {
      "id": "years",
      "label": "Years away",
      "kind": "number",
      "hint": null,
      "default": 15,
      "unit": null,
      "min": 0,
      "max": null
    }
  ],
  "outputs": [
    {
      "id": "pv",
      "label": "Present value",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "pvLump",
      "label": "PV of the lump sum",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "pvStream",
      "label": "PV of the payment stream",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "discount",
      "label": "Value lost to discounting",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Future amount: 250000 $",
      "Annual payment received: 0 $",
      "Discount rate: 6 %",
      "Years away: 15"
    ],
    "outputs": [
      "Present value: $104,316.27",
      "PV of the lump sum: $104,316.27",
      "PV of the payment stream: $0.00",
      "Value lost to discounting: $145,683.73"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter future amount ($).",
      "Enter annual payment received ($).",
      "Enter discount rate (%).",
      "Enter years away.",
      "Read your present value on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "fv": 150000,
        "pmt": 0,
        "rate": 6,
        "years": 9
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "fv": 250000,
        "pmt": 0,
        "rate": 6,
        "years": 15
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "fv": 400000,
        "pmt": 0,
        "rate": 6,
        "years": 24
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "How does the present value calculator work?",
      "a": "Present value discounts future money back to today at a required rate of return. It is the maths behind valuing a settlement offer, a pension buyout, or any deal that pays out later. The underlying maths is: PV = FV ÷ (1 + r)^n, plus the discounted value of any recurring payments."
    },
    {
      "q": "What do I need to enter?",
      "a": "4 values: future amount, annual payment received, discount rate, and years away. Each field starts with a sensible default, so you can change one number at a time and watch the result move."
    },
    {
      "q": "What does the present value result mean?",
      "a": "It is returned as a money amount in US dollars and updates live as you edit the inputs, so you can compare two or three versions of a scenario in a few seconds."
    },
    {
      "q": "Is this calculator free, and do I need an account?",
      "a": "Yes, it's free, and no account is required. Nothing you type is stored on our servers — the maths runs entirely in your browser."
    },
    {
      "q": "How accurate is the result?",
      "a": "It applies the standard formula exactly, so the arithmetic is precise. Results are estimates before tax, fees, and inflation unless an input explicitly covers them."
    },
    {
      "q": "Who is this tool for?",
      "a": "It's built for anyone comparing money scenarios before committing — budgeting a payment, sanity-checking a quote, or seeing what a change in rate or term actually costs."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/future-value",
    "https://www.revenuelab.fyi/toolbox/annuity"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Present Value Calculator (https://www.revenuelab.fyi/toolbox/present-value)"
}