Am I understanding this correctly, that an initial investment of $20 at 18 years old that grows at 9% every year would be worth $1,148 at 65? Why the hell are any young people spending money instead of investing it? That's insane! Why aren't schools teaching this stuff? In exchange for skipping lunch today from a restaurant you could have $1148 to spend on 57 lunches when you retire assuming inflation didn't exist, but probably more like 20 lunches at that point. still 1 lunch today being worth 20 lunches in the future is a no brainer.
>>62155988Its called compound interest
Because you can very often do better than 9% by buying something.Like education or a hobby thing that develops a skills that translates into a good career.
>>62155988>Why the hell are any young people spending money instead of investing itBecause they are low iq.>Why aren't schools teaching this stuff?Because school is meant to turn you into a consuming wage slave not into a free human.Also you forget about inflation. Most poor people at least in the west deserve to be poor.
>>62155988Because food NOW is yummy in the tummy, food later is “oh god I can’t eat it cause diabetes, heart, and liver disease.”Also, food expenses for single people is overrated. The one that kills their savings is alcohol, weed, and smoking.
>>621559889% is an aggressive roi and doesn't account for inflation. Assuming 6% roi and 3% inflation that $20 will be equivalent to $70 in 40 years.
>>62156019Weed is pretty cheap, alcohol even more so. Smoking is a killer though.
>>62155994That isn't true at all.
>>62155988>modeling investments as simple exponentialsIt's so fucking retarded...imagine just making that graph, looking at it, and thinking it means anything at all. Just because we measure returns in percent doesn't mean there is anything inherently exponential in the system.>holy shit my linear fit looks like a line!
>>62155988Because that $1,148 is going to have the buying power of $228 at the time of initial investment... so you just wasted 47 years to 11x your shit.
>>62155988Spending lunch with somebody and making a new friend who happens to have connections can get you a new job/deal that is potentially thousands of % of ROI. ($100 lunch to make a connection with future business partner that nets you a 135k job)Spending your weekends with your uncle and going out to drink and get food with him a couple times a month costs you $200 month, but turns out he had a hidden inheritance and because you and him had such a good connection, he listed you as the estate owner on death Autists don’t understand things like this.
>>62156067$20 of alchohol can get you drunk once, $20 of weed can get you high 2-3 times
>>62155988>investingYou're not investing, you're fucking gambling. You don't own a tad shit of the company nor the product, you're buying magic numbers and expecting them to go up.
>>62155988>Am I understanding this correctlyNo
>>62155988I've made dozens of threads on /biz/ trying to explain compounding, but everyone here is a gambling depro zoomer.
>>62155988Because by the time I'm 65, a loaf of bread is going to cost $350
Because being old sucks, even with money. What are you gonna use that money for? Buy some new toys for your dumb fucking poodle?
>>62156950im the boomerest dividend investor there is, but just using the word compounding is retarded, much less thinking you're actually explaining anything you don't even understand yourself
>>62155988I didn't know this at 18. But /biz/ is part of the reason I saw the opportunity to drop 1K on a dip that green-candled high enough to turn it into over $1 million. Journey's not over though.
>>62156107it's very true, and this is speaking as someone who went and became a machinist.
If you max out a roth for 3 years from the time they're born a child will have enough money to retire
>>62155988>$1,148What's that in current year plus 57 years dollars?
>number go upThe maths on that is correct but now do it at 5%, which is what 9% pa actually is after subtracting (an extremely optimistic) 4% average inflation over those 53 years. Suddenly it's $198. So congratulations you held an investment for half a fucking century to almost make a 10x.Now consider that real inflation for assets that people actually want like real estate are definitely higher than 4%. The system is not really designed for you to win. The closest you can get, is wage slaving and taking on as much debt as you can as early as possible and letting inflation render the debt meaningless. This is why all the normal faggots who do seemingly retarded shit like buying new cars and houses with debt really young don't seem to get punished for what appears to be stupidity, the system in fact renders their seemingly terrible financial decisions moot or even beneficial compared to scrimping and saving like the "smart" kids do. Think about it.
