Let's get one thing straight: When it comes to doing math in the adult world, there will not be any final exams. You don't need to have the answers precisely right. You don't need to use particular formulas. And you don't need to show your work. So by all means, use whatever shortcuts you find helpful.

When you are rounding, you bump a number up, or you knock a number down, to the closest big (or round) number. If you think in terms of tens, then 77 becomes 80, and 72 becomes 70. If you think in terms of hundreds, then 267 becomes 300, and 234 becomes 200.

Real Life, Real Money Use
It is absolutely fine to round cents off to the nearest dollar when figuring tips or approximate costs. It's even fine to do this if you're trying to balance your checkbook. As long as you have enough money in your checking account to cover the checks you're writing, no financial police are going to rat you out.

When you estimate, you do enough of a calculation to come up with a ballpark answer to a numerical or financial question.

Real Life, Real Money Use
Suppose you need to buy three pair of panty hose and they cost $8.50 a pair. You know you're looking at spending roughly $26. Estimating is a perfectly fine—in fact, time-saving—thing to do. Just be sure to estimate up, not down, to be sure you have enough of a cushion in your credit line or sufficient cash in your wallet to complete the transaction without penalty or embarrassment.
Reprinted from Make Money, Not Excuses by Jean Chatzky with permission from Crown Business, a division of Random House, Inc. Copyright © 2006 by Jean Chatzky.  
Please note: This is general information and is not intended to be legal advice. You should consult with your own financial advisor before making any major financial decisions, including investments or changes to your portfolio, and a qualified legal professional before executing any legal documents or taking any legal action. Harpo Productions, Inc., OWN: Oprah Winfrey Network, Discovery Communications LLC and their affiliated companies and entities are not responsible for any losses, damages or claims that may result from your financial or legal decisions.


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