Net Present Value Calculator

What is a net present value calculator?

The net present value of the money is important to be calculated as it tells a person about the value of the lump sum of the money he will receive in the future. In terms of present value, the value of money in the future should always be taken into consideration so that unrealistic approaches and decisions can be avoided.

A net present value calculator is used to calculate the net present value of the money. This calculator works when the user provides all the necessary details required by the calculator to perform the calculations.

Net present value calculator

Format: MS Excel [.xlsx] 2007/2010
File Size: 33 KB

What are the benefits of using the net present value calculator?

  1. When it comes to calculating the present value, many complex calculations are required to be done. The use of a calculator makes math simple and easy for the user. This calculator easily converts the lump sum of the money you will receive in the future into the present dollar amount so that you can get a realistic review of what you are going to get in the future.
  2. The net present value calculator is also very beneficial for professional people who want to decide whether or not they should invest money in a specific project or not.
  3. Many businesses prefer using a net present value calculator when they want to make business plans. Similarly, many people make personal financial plans like experts that help them secure the future of their family.

What is the net present value?

The value of the money to be received in the future in terms of today’s value of the dollar is known as the net present value. The purchasing power of money may change with time. In addition to it, there is an interest rate associated with the money that also decreases or increases over time.

When the value of the money keeps on fluctuating, it is inevitable for all financial institutions and account specialists to bring all the variables to a constant rate so that comparisons between different variables can be made easily.

When to use the net present value calculator?

There are many situations in which it is very feasible to use the net present value calculator for obtaining various types of details. For example, people planning for early retirement can use this calculator to evaluate their future income and other relevant expenses.

Net present value calculator template

This template is an online tool that enables people to get accurate and quick results. The user can easily customize the calculator to make it fit his needs. Once the calculator is customized, the user can get the information that he wants.

While using the template, it should always be kept in mind that the results obtained by using the net present value calculator are not 100% accurate. There are several details in the calculators which are completely based on the assumptions due to which, the result may vary from calculator to calculator.