Tool list
- Paper and pencil. Eraser if you know the truth.
- Calculator or skill in addition-subtraction, multiplication-division, percent, fractions.
- Calendar to keep track of time.
- Confidence in your ability to be honest with yourself.
- Know that computer equipment and software is expensive. Libraries, schools, and rich friends may let you compute in cyberspace if you don't own.
- Keeping running records of income, expenses, and current balance is the bottom line.
- Keeping a positive balance on your account record is the goal.
- Shop for insurance, a bank you can trust comfortably for your account level, and a safe place to keep copies of your records in case the dog eats your work.
- Matching your records with the records of those you do business with is how trust (and credit) are maintained. Excuses come in money, contracts, friends more or less, even habits. There are a lot of people in jail over money problems.
- Being human is having an ability to be responsible. Confidence is different from pride, and pressure sales people are good doubletalkers.
The Rules
- The rules are in terms that are conducive to trust.
- The Terms are the objects of the rules.
- A bank sells services related to money. Who's money? Yes.
- The goal of keeping the rules is the sane use of money.
- Time is real where money is concerned.
- You can earn your own money; receive it as a gift or benefit to spend; and you can save money for money and later. Savings accounts pay interest on the principle (sum deposited).
- Obligations of citizenship include taxation. (A feudal vestige of the early days of civilization.) Better to pay taxes than to suffer losses due to wild justice.
- Insurance is cheap emergency aid as well as a restriction to obtain priviledges like vehicle ownership and operation.
- Money makes a great gift. What you know about what it's for is common.
- If you have the misfortune of being summoned to court for a judgment, you have the priviledge of paying money to cover the due process instead of paying by wasting time in jail.
The Mathematics
- Both the keeping of savings and the lending of loans are paid for by interest. Interest is a fee in percent of some sum of money called Principle or Balance. The bank pays you to put money into a savings account; you pay the bank to borrow. Interest is calculated in terms of Principle and Time.
- EnCalc.com has provided the following calculator for compound interest...
Here are some more links:
www.mathsisfun.com/money/compound-interest-derivation.html
www.simpleinterestformula.com/compoundinterest.php
www.math.com/tables/general/interest.htm
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