City-Data Forum Stupid math question (percentage, interest, money, financial)
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01-19-2009, 09:30 AM
 8,158 posts, read 12,112,523 times Reputation: 10942

Having a 401k for retirement is really bad for those of us who just don't get math and never will.
<panic'ed sigh>

So...if someone invested 70,000 and 5 years later had 100,000 for a total gain of 30,000 over 5 years
what is that in a percentage?
.428? so is that less than 1% gain? I.e. i'd be better off with my 401K money in a CD?

01-19-2009, 09:36 AM
 Location: Wilmington, NC 412 posts, read 1,126,979 times Reputation: 297
It is actually a gain of 42.86%....you must carry the decimal over 2 places to get the %.

01-19-2009, 09:01 PM
 Location: Southeast 625 posts, read 4,177,433 times Reputation: 364
wow, just wow

01-19-2009, 09:09 PM
 28,453 posts, read 73,398,566 times Reputation: 18485
Oh my...

Please google Douglas R Hofstadter & innumeracy. Better yet, read this book: Amazon.com: Innumeracy: Mathematical Illiteracy and Its Consequences (Vintage): John Allen Paulos: Books

01-19-2009, 09:20 PM
 Location: So. of Rosarito, Baja, Mexico 6,728 posts, read 19,201,930 times Reputation: 6234
To get the percentage "%" you must divide the smaller number by the larger number

\$30,000 divided by \$70,000 =04285714= 42.86 %

01-20-2009, 07:37 AM
 3,763 posts, read 10,975,349 times Reputation: 6760
Yes.. you're doing the first step correctly. 30,000/70,000 = 0.429.

What you're forgetting is that to convert a decimal to a percent, you must mulitply by
100%.

so 0.429 x 100% = 42.9%.

that's a HUGE return, by the way. HUGE. I'd be thrilled with 5% to be honest, and the numbers you're putting out there are 8x that much!

Math isn't that bad - just get some simple advice, and if you don't have a financial planner, it might be a good idea to consult one if you can find one you like and trust.

01-20-2009, 07:44 AM
 7,100 posts, read 24,938,695 times Reputation: 7345
Keep in mind that the gain or loss is just a paper amount until you cash your investment in. It doesn't really mean a thing unless you can actually put the money in your pocket.

01-20-2009, 04:10 PM
 8,158 posts, read 12,112,523 times Reputation: 10942
Yea I know, head smack, books on math illiteracy, math anxiety. Believe me, I've tried and tried. Not stupid in any other way. Took remedial math classes (over and over), tutors.
It's all or nothing with me and its NO MATH capabilities. Can't do the spatial things either, you should see me try to put something together. I joke that the reason my head seems sort of small is because I was born without my math lobe. Or that those few of us who just can't do it are the pure blood descendants of the original earth humanoids, everyone else has a little alien blood.
Whatever. Its not funny really but what am I going to do? I cried my eyes out coming home from those math classes cuz I love science. Love the idea of wood working. After years of torture (mid 20s or so) I finally said, stop. Don't look back. Grow a really really thick skin and just get used to having ask for answers/help. Go with your strengths.
I don't know. Its sort of like being dyslexic.
But it makes the trying to manage your money, especially wondering whether your 401K is doing well or not gut wrenching as hell.
If that John Allen Paulos thinks its some sort of system problem etc. bring him on. I'd love to have try to teach me math.
Mostly what I've learned is that whole "you can do anything if you try hard enough" is a big fat lie. Why do they tell kids that anyway?

01-20-2009, 05:04 PM
 Location: Virginia 931 posts, read 3,511,922 times Reputation: 447
(current value - start value)/(start value)

01-20-2009, 05:27 PM
 28,673 posts, read 41,196,392 times Reputation: 37417
Quote:
 Originally Posted by Giesela Yea I know, head smack, books on math illiteracy, math anxiety. Believe me, I've tried and tried. Not stupid in any other way. Took remedial math classes (over and over), tutors. It's all or nothing with me and its NO MATH capabilities. Can't do the spatial things either, you should see me try to put something together. I joke that the reason my head seems sort of small is because I was born without my math lobe. Or that those few of us who just can't do it are the pure blood descendants of the original earth humanoids, everyone else has a little alien blood. Whatever. Its not funny really but what am I going to do? I cried my eyes out coming home from those math classes cuz I love science. Love the idea of wood working. After years of torture (mid 20s or so) I finally said, stop. Don't look back. Grow a really really thick skin and just get used to having ask for answers/help. Go with your strengths. I don't know. Its sort of like being dyslexic. But it makes the trying to manage your money, especially wondering whether your 401K is doing well or not gut wrenching as hell. If that John Allen Paulos thinks its some sort of system problem etc. bring him on. I'd love to have try to teach me math. Mostly what I've learned is that whole "you can do anything if you try hard enough" is a big fat lie. Why do they tell kids that anyway?
I am not a teacher, but have been around many children that couldn't get math (usually girls, but that's the educational system and it's attitudes). I found that by making them think of it as a game and not something they were required to learn or else, that I could get them started on the right path. As a game it becomes interesting and fun, not difficult and depressing.

I tell people to look at computers the same way. If you have to learn rules to play a game and the computer is thought of as a game, then just like a complex game (chess, backgammon, etc) you simply take the time to learn the rules (or as many as you need to learn to do what you need to do on it). I've had clients that were scared to death of their compters until I convinced them it was nothing more than a big "Game".

Have you tried any of the "other" methods of doing math? One of my brothers read about the Tractenburg method and finally got it. Trachtenberg system - Wikipedia, the free encyclopedia He's no dummy by any means, but math just threw him. The interesting part is that he was a carpenter for most of his life and just "did" that math without thinking. Math in any other setting through him for a loop.
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