What does time value of money mean?

It is the idea that money available now can earn a return, so it is worth more than the same nominal amount received later.

Can this solve the interest rate or number of years?

No. This version solves future value, present value, or payment only. Enter the rate and years directly.

What is the difference between beginning and end payments?

Beginning-of-period payments are made one period earlier, so each payment earns one extra period of interest compared with end-of-period payments.

What happens at a 0% rate?

The calculator switches to the linear version of the formula: future value equals present value plus payment times the number of periods.

FINPersonal Finance

Time Value of Money

Solve future value, present value, or recurring payment from a starting amount, target amount, rate, term, payment frequency, and payment timing.

Currency

Solve for

Present Value

Payment

Annual Rate

Years

years

Periods per Year

Payment Timing

Examples

Enter values above to see results

How It Works

Formula

\text{FV} = \text{PV}(1+i)^n + \text{PMT} \times T \times \frac{(1+i)^n - 1}{i}

Where

$\text{FV}$: Future value
$\text{PV}$: Present value
$\text{PMT}$: Payment made each period
$i$: Periodic rate, annual rate divided by periods per year
$n$: Total periods, years multiplied by periods per year
$T$: Timing factor: 1 for end payments, 1+i for beginning payments

The calculator converts the annual rate into a periodic rate, multiplies years by periods per year, then applies the future value annuity relationship. For present value and payment modes it algebraically rearranges the same relationship.

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