When I got ripped off
One thing that I have tried to drill into my kids since they were young is "Do the math". It may seem like a simple thing but so many people don't do it. Sometimes it gets avoided because people are rushed and sometimes because they don't know how to do the math.
Now I personally hate paying more but just recently I got swindled. Not because of someone trying to cheat me but rather that I didn't realize how bad the forex numbers were on a minor currency paid. Specifically the Philippine Peso to Indonesian Rupiah exchange rate. Typically I use CAD or USD when I exchange currencies and they usually have a pretty good rate. I rarely think much about it. This time I thought I would just change out my PHP and things went smoothly.
I gave them 21,120 Philippine Peso's and in return I received 4,400,000 Indonesian Rupiah. In my defense I had been waiting for a long time in the lineups to get through to the boarding gate and I wasn't really thinking too hard about doing the math. Silly me.
Here is the math:
So the PHP that I had should be worth $487.51.
How much should I receive in Indonesian Rupiah?
How much did I actually receive?
4,400,000 IDR
The exchange fee was IDR 1,477,963 .... Ouch
I was feeling pretty bad about that but doing some research I found that minor currency pairs have a much higher fee. Now, I was expecting it to be higher but 25%? That was very bad.
The good thing about this experience
However, I learned something. I learned that minor pairs cost more and I should ALWAYS do my math in advance for those FOREX transactions. Sure I paid too much one time, but I consider the knowledge to be extremely valuable.
On Hive smaller pairs can also have really awful exchange rates. Look at this one for AFIT tokens.
In this case you buy for 0.000390 but you sell for 0.000192. Consider that. If you had 100 Hive you would get 256,410 AFIT. If you wanted to sell them you would get: 49.23 Hive. You would lose over half in one transaction. Although having said that... 100 HIVE would be too much for the buy and sell wall so you wouldn't actually get that many AFIT and you couldn't even sell them all because there aren't enough buyers.
Trying to buy that many AFIT would be a terrible idea. Knowing that is important!
But should we teach our children about it?
My first thought would be: No.
There are a lot of different things that will come up in life that are important and trying to warn a child about ever edge case isn't going to be very useful.
I would say that children should be given the tools to do the math and figure things out for themselves. In this case the math is very simple, it is a simple rate and ratio problem that I was taught in Grade 6 a long long time ago.
Sure I didn't do the math this time, well, at least I didn't do it before I had finished the transaction. I could have done the math in advance but I made the mistake not to.
Lessons learned in life stick far better than those in a classroom. Will I ever make that same mistake again? Probably not. If I was taught in a classroom? I probably would have made the same mistake because classroom knowledge doesn't just stick like real world mistakes :)
