A worked example
$10,000 received 10 years from now, discounted at 6%, is worth about $5,584today — meaning you'd need to invest roughly that much now, at that rate, to have $10,000 in a decade.
Frequently asked questions
What discount rate should I use?
A common choice is your expected investment return, or the interest rate you'd otherwise earn on the money — sometimes called the opportunity cost of capital. A higher rate means future money is discounted more heavily.
How is this different from inflation adjustment?
Inflation adjustment removes the effect of rising prices specifically. Present value discounting is broader — it reflects that money available now can be invested and grow, regardless of inflation, so it's worth more than the same amount later.
This calculator provides estimates for general informational purposes only and is not financial advice.