# Time Value of Money Calculator

URL: https://speedycalculator.com/calculators/finance/time-value-of-money/
Last updated: 2026-10-25

> The time value of money calculator converts between present value and future value for a lump sum at a given interest rate, term and compounding frequency – type into either value to work in both directions.

## Inputs

- Present value
- Annual interest rate (%)
- Term (years, months)
- Compounding frequency

## Results

- Future value
- Interest
- Growth factor

## Formula

```
FV = PV × (1 + r ÷ m)^(m × t)
Continuous: FV = PV × e^(rt)
PV = FV ÷ (1 + r ÷ m)^(m × t)
```

## Explanation

A dollar today is worth more than a dollar tomorrow because it can earn interest. The time value of money is the foundation of loans, investments, pensions and valuation.

### How to use the Time Value of Money Calculator

- **Present value**
- **Annual interest rate**
- **Term**
- **Compounding frequency**
- Every result field is editable: type into **Future value** and **Present value** plus every other field update to match.

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter the present value, interest rate, term and compounding. Type a future value into the result to find the present value.

### Tips

- Use the nominal annual rate and pick the compounding frequency your bank or broker states.
- Small differences in return or fees compound into large differences over decades.
- Run the calculation with a cautious, a central and an optimistic return to see the range of outcomes.
- Past returns do not guarantee future returns – nothing here is investment advice.

### Common mistakes to avoid

- Comparing an APR with an APY or effective rate.
- Ignoring inflation, taxes and fees when judging a real return.
- Entering a percentage as a decimal (5 instead of 0.05 is correct here).

### Inputs explained

FieldWhat to enterPresent valueAmount in your currencyAnnual interest rateIn %TermUnits: years, monthsCompounding frequencyChoose one: Yearly, Semi-annually, Quarterly, Monthly …

### What each result means

- **Future value** = [Present value]×(1 + effr([Annual interest rate]÷100, [Compounding frequency]))^[Term]
- **Interest** = [Future value] - [Present value]
- **Growth factor** = (1 + effr([Annual interest rate]÷100, [Compounding frequency]))^[Term]

### Example values

How the main result changes when **Present value** changes and everything else stays at the example values above:

Present valueFuture value500909.77501,364.551,0001,819.41,2502,274.251,5002,729.12,0003,638.79

## Worked example

Inputs — Present value: $1,000; Annual interest rate: 6 %; Term: 10 years; Compounding frequency: Monthly.

Results — **Future value = $1,819.40**; Interest = $819.40; Growth factor = 1.8194.

## FAQ

**What is the time value of money?**
The idea that money now is worth more than the same amount later.

**How do I find present value from future value?**
Divide by (1 + r/m)^(mt) – or type FV into the result field.

**Why does compounding frequency matter?**
More frequent compounding means slightly faster growth.

**What formula does the Time Value of Money Calculator use?**
FV = PV × (1 + r ÷ m)^(m × t).


## Sources

- [U.S. SEC – Investor.gov compound interest and investing basics](https://www.investor.gov/)