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How to Calculate PVIF and PVIFA on Simple Calculator in 10 Seconds

How to Calculate PVIF and PVIFA

Calculate PVIF- Present Value of Interest Factor & PVIFA- Present Value of Interest Factor of Annuity using Simple Calculator. What is the ‘Present Value Interest Factor – PVIF’

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The present value interest factor (PVIF) is a factor that is utilized to provide a simple calculation for determining the present value dollar amount of a sum of money to be received at some future point in time.

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For determination or consideration of a series of possible present values, PVIFs are often represented in the form of a table used for calculating the present value of a future sum with varying interest rate and time period combinations.

The present value interest factor is based on the foundational financial concept of the time value of money, which states that the present value of a sum of money not to be received until sometime in the future must be discounted from the future amount according to a rate of return that could be earned on capital at the present time.

How to Calculate PVIF and PVIFA on Simple Calculator

To Calculate PVIF of 12% for 4 years.
1. Convert 12% into decimal part = 12/100 = 0.12
2. Add 1 to it = 0.12 + 1 = 1.12
3. Now, just press “1/1.12” and press “=” as many times as the number of years (here 4 times)
4. You got the answer (PVIF) – 0.6355
To Calculate PVIFA of 12% for 4 years.
Follow the first 4 steps, and
5. Press the GT (Grand Total) button on the Top Left side.
6. You got the answer (PVIFA) – 3.0373

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