Understanding the Mathematics of Personal Finance: An Introduction to Financial Literacy
Product ID: 65927946
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A user-friendly presentation of the essential concepts and tools for calculating real costs and profits in personal finance Understanding the Mathematics of Personal Finance explains how mathematics, a simple calculator, and basic computer spreadsheets can be used to break down and understand even the most complex loan structures. In an easy-to-follow style, the book clearly explains the workings of basic financial calculations, captures the concepts behind loans and interest in a step-by-step manner, and details how these steps can be implemented for practical purposes. Rather than simply providing investment and borrowing strategies, the author successfully equips readers with the skills needed to make accurate and effective decisions in all aspects of personal finance ventures, including mortgages, annuities, life insurance, and credit card debt. The book begins with a primer on mathematics, covering the basics of arithmetic operations and notations, and proceeds to explore the concepts of interest, simple interest, and compound interest. Subsequent chapters illustrate the application of these concepts to common types of personal finance exchanges, including: Loan amortization and savings Mortgages, reverse mortgages, and viatical settlements Prepayment penalties Credit cards The book provides readers with the tools needed to calculate real costs and profits using various financial instruments. Mathematically inclined readers will enjoy the inclusion of mathematical derivations, but these sections are visually distinct from the text and can be skipped without the loss of content or complete understanding of the material. In addition, references to online calculators and instructions for building the calculations involved in a spreadsheet are provided. Furthermore, a related Web site features additional problem sets, the spreadsheet calculators that are referenced and used throughout the book, and links to various other financial calculators. Understanding the Mathematics of Personal Finance is an excellent book for finance courses at the undergraduate level. It is also an essential reference for individuals who are interested in learning how to make effective financial decisions in their everyday lives. Review: Good generally, but caveats - Conceptually this is a good book that focuses on the math involved in personal finance, but don't expect to find the website and spreadsheets he talks about. The explanations in the text are sufficient for you to use a financial calculator (like a BA II Plus) to do the examples or with some savvy, to generate your own spreadsheets. One caveat is that there are occasional errors where the wrong starting values are used. Example: on page 89, at the top, the table shows total present value as $2920.31 (the correct value), but below that a different value ($2932.47) appears into the equation. On the WayBack Machine, you can find saved versions of his website, enough to find a page with some errata, but it is far from complete. That errata page relates to several incorrect answers to his problems. Review: i understand - i enjoy how this book explains personal finance without being just another book on how to make money which was difficult to find.
| Best Sellers Rank | #5,647,803 in Books ( See Top 100 in Books ) #591 in Business Mathematics #5,659 in Statistics (Books) #16,561 in Applied Mathematics (Books) |
| Customer Reviews | 4.2 out of 5 stars 5 Reviews |
D**S
Good generally, but caveats
Conceptually this is a good book that focuses on the math involved in personal finance, but don't expect to find the website and spreadsheets he talks about. The explanations in the text are sufficient for you to use a financial calculator (like a BA II Plus) to do the examples or with some savvy, to generate your own spreadsheets. One caveat is that there are occasional errors where the wrong starting values are used. Example: on page 89, at the top, the table shows total present value as $2920.31 (the correct value), but below that a different value ($2932.47) appears into the equation. On the WayBack Machine, you can find saved versions of his website, enough to find a page with some errata, but it is far from complete. That errata page relates to several incorrect answers to his problems.
J**N
i understand
i enjoy how this book explains personal finance without being just another book on how to make money which was difficult to find.
J**E
Not quite what I expected
I bought this book hoping to find a thorough grounding in personal finance maths i.e. a layperson's book that explains the mathematics behind common financial products and how to apply it in the real world in order to be an educated consumer without having to get a finance degree.. The book started off very well with a great derivation of a formula to work out loan payments and a good explanation of credit card interest but for most of the rest of the book the author does not provide mathematical information but simply directs you to his website to download his personalized excel spreadsheets and discusses the topics with reference to these spreadsheets- although the info provided is still good. This may be useful for some readers who want a quick look at calculations, but I of course wanted something a little deeper.I may have to resign myself to digesting a tricky actuarial textbook to get the info I need.
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