Apr 01, 2024

### Question of the Day: Would you rather have \$1,000,000 or start with a penny and double your money every day for 30 days?

A good question to show the power of compounding...of course be sure to tell them that no investment would actually double on a daily basis for 30 days ;) Calculators are not allowed!

Answer: Starting with a penny and doubling it every day compounds to \$10.7 million after 30 days

Day 1: You would have \$0.02

Day 2: You would have \$0.04

Day 3: You would have \$0.08

Day 4: You would have \$0.16...

Day 30: You would have \$10,737,418.24.

Questions:

• How much would the penny have grown to on Day 29? How much did the value increase between Day 29 and Day 30?
• Now apply this concept to your own savings...
• Is it better to start saving early (e.g., starting at age 20 and saving for 30 years) or waiting until your life is more stable (start saving at age 30 and saving for 20 years). Use the example of the penny doubling to explain your answer.

Here are the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers:

Here's the spreadsheet with the calculations.

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Looking for more? Check out INTERACTIVE: The Power of Compounding and the math behind compounding with our activity MATH: The Rule of 72.

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