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For most young people, interest rates on savings accounts have been effectively 0% for most of their lives. That has changed within the last few years but may a
by stetrain 3y ago
For most young people, interest rates on savings accounts have been effectively 0% for most of their lives. That has changed within the last few years but may also be temporary.
Compounding gains in investments still work out in the long run, but an older generation trying to tell the younger one about putting money in a savings account and letting it earn compound interest has been out of touch for a couple of decades now.
- chii 3y ago> an older generation trying to tell the younger one about putting money in a savings account and letting it earn compound interest i have not heard a single older person saying this. Every one of them says to invest in assets, not bank interest.
- stetrain 3y agoI heard it from parents, grandparents, high school teachers and college professors. And the comment I replied to specifically mentioned "compound interest"
- snovymgodym 3y agoI've heard the savings/bond/CD advice from older people who were working during the Volcker years.
- memcg 3y agoSure, I started an IRA account in 1985 with CDs paying 10+% But, I bought my house in 1982 with a 15.5% mortgage, refinanced @ 11.25 after a couple years and again @ 8.5% until it was paid off in 2002
- gruez 3y ago> For most young people, interest rates on savings accounts have been effectively 0% for most of their lives. That has changed within the last few years but may also be temporary. Compounding applies to stock returns as well, which have been on a tear for the past decade. If anything not knowing what to do with your money besides parking it in a bank account is a sign of financial illiteracy, which is what OP was decrying.