Present Value Calculator
A present value calculator shows what a sum of money due in the future is worth today. It works this out by discounting the future amount at a yearly rate for a set number of years. The answer is the amount you would need today to reach the same figure at that rate.
This tool is useful when you are comparing a payment due later with money you could have now. It shows the present value of the amount and the discount, which is the difference between the future figure and today's value. Enter your own figures below to see the result for your situation.
How to use the present value calculator
- Enter the amount you expect to receive in the future in the first box, in pounds.
- Enter the discount rate per year as a percentage in the second box.
- Enter the number of years from now until the amount is due in the third box.
- Check the present value shown, which is what the future amount is worth today.
- Check the discount shown, which is the difference between the future amount and the present value.
- Compare the figures with your lender or bank if the result will feed into a decision about a property sale or purchase.
The formula
- Present value = future amount ÷ (1 + rate ÷ 100) ^ years
- Discount = future amount − present value
Worked example
The figures below are made up to show the maths. They are not current prices, rates or product figures.
| Amount in the future | £10,000.00 |
|---|---|
| Discount rate per year | 5% |
| Years from now | 10 years |
- Present value £6,139.13
- Discount £3,860.87
Tips for an accurate answer
- Use the same yearly rate you would realistically expect to earn or pay, as the result depends heavily on this figure.
- Enter the number of years as a whole or partial figure that matches the actual date the money is due.
- Remember that the calculator assumes one fixed rate for the whole period, so it may not reflect changing conditions.
- Check that the future amount is the gross figure you intend to compare, without fees or deductions already taken off.
- Run the calculation with a few different rates to see how sensitive the present value is to your assumption.
Questions people ask
How to calculate the present value of a future value?
Enter the future amount, the discount rate per year as a percentage, and the number of years from now. The calculator divides the future amount by one plus the rate, raised to the power of the years, and shows the result as the present value. Use the figure shown as your present value.
What is the present value of $5000 to be received 10 years from now if the interest rate is 10 percent?
This calculator works in pounds, so enter the amount in pounds rather than dollars. Enter the future amount, a rate of 10 and 10 years, and the tool will show the present value and the discount. Check any result that matters with your bank.
Can this calculator work out the future value of money?
This calculator works in the opposite direction, starting from a future amount and finding its value today. It does not calculate the future value of an amount invested now. Use a separate future value calculator for that purpose.
How do I work backwards from a present value to a future amount?
This tool starts from the future amount and finds the present value, so it does not run the reverse calculation directly. To estimate the future amount from a known present value, you would need a future value calculator. Check the result with your lender or bank.
Does this calculator give financial advice?
No. It performs the arithmetic of discounting a future amount at a yearly rate and does not recommend any course of action. Check the figures with your lender, bank or a qualified adviser before relying on them for a decision.
What does the discount figure mean?
The discount is the future amount minus the present value. It shows how much value the future sum loses when it is brought back to today at the rate you entered. In the worked example the discount on £10,000.00 is £3,860.87.
Why does a higher discount rate lower the present value?
A higher rate reduces the present value because the future amount is divided by a larger factor. The calculator applies the rate as a compound figure over the number of years you enter. Trying a different rate will show this effect directly.
Can I use this for money due in a few months?
You can enter a partial number of years to represent a shorter period. Make sure the figure matches the actual time until the payment is due. Check any result that matters with your lender or bank.
Sources
This calculator uses the standard loan and interest formulas above and the numbers you type. It needs no outside figures.
An estimate from the numbers you enter, worked out with the formula shown. It is maths, not financial advice: your lender or bank has the final figures. Page checked 23 Oct 2026. Read the disclaimer