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InvestHub.com's
Finance Dictionary and Glossary of Investment Terms

time value of money  

Definition 1.

The idea that a dollar now is worth more than dollar in the future, even after adjusting for inflation, because a dollar now can earn interest or other appreciation until the time the dollar in the future would be received.
 

Definition 2.

The idea that a dollar today is worth more than a dollar in the future, because the dollar received today can earn interest up until the time the future dollar is received.
 

Definition 3.

The basic principle that money can earn interest. Therefore, something that is worth $1 today will be worth more in the future if invested. This is also referred to as future value.
 
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