Our Kids Financial Future

Budget101 Discussion List Archives Budget101 Discussion List Our Kids Financial Future

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    • #257559

      Yes most of this is from the parents, but I feel my generation (those

      thirtysomething) have an extremely bad understanding of debt/compound

      interest/budgeting so sometimes the teachers have a big effect on students.

      I know that most of my friends in this age group who are now good at these

      things are mostly from their parents teaching them, but there are a few that

      could learn alot through some geeky math teachers who are good at giving

      exciting examples of the power of compound interest.

      Here’s an example from bankrate.com that I heard similar to what I learned

      about in my mid 20s that was helpful to me to get started on my 401K right

      away. I was a math major so yes I may have been a geek to begin with, but

      these things were helpful to get me thing.

      “Let’s say you save $2,000 every year for 20 years, and your investments

      earn 8 percent annually. If you start at age 25 and contribute until age 45

      and then save nothing further, by age 65 you’d have roughly $426,000. But if

      you wait until age 35 to begin saving $2,000 a year for 20 years and then

      retire at 65, your kitty would amount to about $198,000. In both scenarios

      your out-of-pocket contribution is $40,000. “

      To me these additional examples of compound interest are helpful to give

      example of saving instead of acquiring debt.

      Thanks,

      Shawn

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Budget101 Discussion List Archives Budget101 Discussion List Our Kids Financial Future