Identify and discuss at least two ways you might be able to

Identify and discuss at least two ways you might be able to use the time value of money calculations in your personal life.

The two ways, I might use time value of money concept:

1) Calculating present value of future expected income

2) Calculating future value of savings

I am expected to receive a gift from my friend of $10,000, 5 years from now. Present Interest rate in market is 10%

Present value of gift = Value of gift / (1+Rate)^Years

= 10000/(1+10%)^5

=$6,209

And If I receive $10000 after 5 years, I would invest for next 10 years @ 10% interest rate. Expected value after 10 years?

Expected Value = Value of gift*(1+Rate)^Years

Expected Value = 10000*(1+10%)^10

=$25,937