What is Time Value of Money (TVM)?
The Time Value of Money principle states that a dollar today is worth more than a dollar in the future because of its potential earning capacity. This calculator helps you solve for any of the five key variables in a TVM problem.
The Five Key Variables
- FV (Future Value): The value of an investment at a future date.
- PV (Present Value): The current value of a future sum of money.
- PMT (Payment): The periodic payment in an annuity.
- N (Number of Periods): The total number of compounding/payment periods.
- I/Y (Interest Rate per Year): The nominal annual interest rate.
How to Use This Calculator
- Select which variable you want to solve for by clicking one of the tabs (FV, PV, PMT, N, or I/Y).
- Enter the known values in the input fields.
- Click Calculate.
- View the result, interactive chart, and detailed schedule.
Important Notes
- This calculator assumes payments are made at the end of each period (ordinary annuity).
- Interest is compounded at the same frequency as payments.
- For loans, PMT is usually negative (money going out). For investments, it can be positive.