Share 050: Not All Financial Education is Created Equally

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February 07, 2020

050: Not All Financial Education is Created Equally

7 minutes

EPISODE HIGHLIGHTS:

Erik shares a story of a conversation he recently had with an individual who studied finance and daily trades in the market.
It was interesting to find that the individual was not aware of different financial concepts.

KEY POINTS:

Erik revisits the rule of 72, the compound interest formula where we take the number 72 and divide it by the interest rate we earn on our money and it equals the number of years it will take our money to double.

72 / % rate = # years money will double
Erik also talks about the indexing strategy where our money is not in the market but is based on market performance and we get the growth but are protected from the downside in case the market goes down. He brings up index funds which people are familiar with where a mutual fund is composed of specially the S&P 500.

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By Erik Smith

2222 ratings

February 07, 2020

7 minutes

EPISODE HIGHLIGHTS:

Erik shares a story of a conversation he recently had with an individual who studied finance and daily trades in the market.
It was interesting to find that the individual was not aware of different financial concepts.

KEY POINTS:

Erik revisits the rule of 72, the compound interest formula where we take the number 72 and divide it by the interest rate we earn on our money and it equals the number of years it will take our money to double.

72 / % rate = # years money will double
Erik also talks about the indexing strategy where our money is not in the market but is based on market performance and we get the growth but are protected from the downside in case the market goes down. He brings up index funds which people are familiar with where a mutual fund is composed of specially the S&P 500.

RESOURCES MENTIONED:

...more