Future Value Calculator New


Future Value Calculator is a finance tool used to calculate the value of a cash flow at a later date than originally received using a constant interest rate. This idea that an amount today is worth a different amount than at a future time is based on the time value of money

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The time value of money is the concept that an amount received earlier is worth more than if the same amount is received at a later time. For example, if one was offered $100 today or $100 five years from now, the idea is that it is better to receive this amount today. The opportunity cost for not having this amount in an investment or savings is quantified using the future value formula. If one wanted to determine what amount they would like to receive one year from now in lieu of receiving $100 today, the individual would use the future value formula.

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