I am reasonably smart and fairly good at math. I can plug numbers into formulas and solve for x, and I’m pretty good at estimating. Over the years the one thing that just hasn’t stuck has had to do with compound interest. Sure, if you give me the formula I can pump in the numbers. But the formula, and how to figure out how much the interest is going to be, that part has never stuck.
I’m working on a project that has me learning, or, refreshing my programming skills. For this I am using one of the myriad of programming instruction books. One of the exercises involves writing, or typing in, a small program that will calculate your monthly payment based on the principal, interest, etc. that you input, for a loan. Yes there are lots of programs out that do this. And I’ve played with a few when wondering if it might be worth it or possible to buy a house.
Even though I’ve played with the mortgage calculators and I know that paying interest on something makes it cost more, I never could really estimate how much more the interest was going to make something cost. Either I didn’t care or it didn’t click. Playing with this little program I wrote has changed that. I now get it.
I find it interesting how learning about one thing can shed light on something else. For example learning or studying a different language helped me better understand English grammar. Or how learning about programming has helped me understand compound interest.