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Compound interest is taught in school, but the important part that is left out is how it can effect things like school debt, housing debt, your retirement savin

• cwilkes 10y ago
  That's what everyone else on this thread is missing: sure the basics are there but people don't know how or to what to apply them too. It is sort of like complaining "but it is / is not in the spec!" And expecting to be absolved of any problems with the product pushed out.
• Avshalom 10y ago
  Meh? I mean retirement savings: over the course of 30 year you can expect about double what you put in. "oh if you put in 5000 now when you're 70 you'll have 10000" is not really that impressive (and of course that works out even if it's not a one time sum. Assuming you don't retire just before/after a market collapse you're going to see about double what you put in (that's assuming were talking actual investments, the .01% interest on a savings account is just an insult)). It's basically the reverse with housing and student loans. You end up paying about double what you take out. A) you don't really need easy facility with compound interest to be made to understand that B) "about double" is, despite Einstein claiming otherwise, not actually that powerful. Credit Card debt is really the only thing that most people will interact with that has sufficiently high interest rates to be worth worrying about and like I said elsewhere the principle on CC debt is going to be having constant significant swings which makes analysis entirely dependent on spending habits, not the interest.