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Time Value Of Money

A very useful calculation is used to determine how much the value of money changes with time. This model is not about payments.  It is about a lump-sum of money and how its value changes with time assuming a fixed interest rate.

In this calculator each column can be used as a different example. Enter the required information in the highlighted boxes, then click "Calculate." All three examples will then be calculated with the information that has been entered.

There are two ways to use this calculation:

Method 1              

  • For calculating how much money you will have if the money were invested in a simple savings plan of some type.  This could be a Money Market account, CDs, or something of that nature.
  Example
'A'		 Example
'B'		 Example
'C'
starting date (xx/xx/xxxx)
future date (xx/xx/xxxx)
interest rate (4.5% per year is entered as 4.5)
starting amount, in dollars
   
future date amount, in dollars
 


Method 2              

  • For calculating how much money you would need to invest today so you would have a needed amount in the future.
  Example
'A'		 Example
'B'		 Example
'C'
starting date (xx/xx/xxxx)
future date (xx/xx/xxxx)
interest rate (4.5% per year is entered as 4.5)
future amount needed in dollars
   
investment needed on start date