How Did You See an IDIOT Completely BLOW ALL THEIR MONEY? - Reddit Podcast

[@amithegenius]

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[@Scottthespy13]

It's not the worst financial decision, but it is the most *common* bit of financial illiteracy I see in my own generation (35f). Not understanding how compound interest works. I'm not talking about being able to *calculate* the interest...although that's a pretty simple formula that's really intuitive once it's been explained...but not understanding the basic *premise* of 'Have lump sum. Sum earns interest. Interest goes back into lump sum. Lump sum is now bigger, and thus earns more interest'. Even when I explain it, both in simple terms and in long drawn-out explanations with examples, a lot of my friends don't get it. Which is dangerous, because that's the way credit card interest gets you. Not understanding this is how so many people get into trouble with their credit, by having large amounts *owing* that then keep accruing more and more interest. I've had so many friends get stuck in situations they literally don't have enough money to get back on top of the payments.

[@bensoncheung2801]

Oh.

[@TrustfulLoki85]

I am not first

[@bensoncheung2801]

Is Genius first?

[@TrustfulLoki85]

@@bensoncheung2801 yeah, I was second

[@bensoncheung2801]

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