The time value of money or TVM is a fundamental concept that affects your financial planning and investment success.

Whether you're considering borrowing, saving, or investing,

understanding TVM helps you make better money decisions.

This podcast will review the time value of money,

why it matters, and how to calculate your investment returns.

Welcome back everyone and thanks for joining me. I'm Laura Adams and author,

spokesperson, speaker, founder of the Moneystack newsletter and host of the

Money Girl podcast with 43 million downloads. If you're not already subscribe, that is the best way to ensure you never miss an

episode. We're now doing two weekly shows that come out on Wednesdays and Fridays.

And Fridays I'm doing questions from listeners.

So if you have a money question you'd like me to cover, please leave it on our voicemail line.

Just call 302-3640308.

You can also send me an email using my contact page at Laura D Adams.com.

And while you're there, you can also sign up for the free money stack newsletter.

So the time value of money or TVM is the concept that a dollar today is worth more than a dollar tomorrow.

For instance, let's say you're paid $1,000 right now.

That is more valuable than getting paid $1,000 in a year from now.

That's because you can take that $1,000 and you could put it in the bank and earn interest

or invest it for potential growth during the year.

However, the value of money depends on factors like inflation

and the potential interest rate that you could earn.

Inflation always reduces the time value of money

...