savings & investing foldables. financial pyramid speculative real estate commodities capital...
TRANSCRIPT
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Savings & investingFoldables
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Financial Pyramid
• Speculative• Real Estate• Commodities
Capital Growth
• Mutual Funds• Stocks• Bonds
Financial Growth
• Money Market Account• Retirement• Certificate of Deposit
Income
• Will• Insurance• Emergency• Savings Account
Basic Financial Planning (Protection)
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Savings tools
Savings Account
• Money not spent on current expenses
• Lower Interest
• Low Risk• Highly
Liquid
Money Market Deposit Account
• Money not spent on current expenses
• More interest
• Medium Liquidity
• Low Risk
Certificate of Deposit
• Putting your money into a time commitment account.
• Higher Interest
• Financial penalties for early withdrawal
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Investment tools
Bonds
•A form on loaning your money to the government or a company
•Low Risk•Low liquidity
Stocks
•Purchasing part ownership in a company
•Medium Risk
•Low Liquidity
Mutual Funds
•Investing in several different types of investments
•Medium to Low Risk
•Low liquidity
Real Estate
•Purchasing Commercial or Residential Property
•Low liquidity
•High Risk
Speculative Investments
•High Risk Investments
•Penny Stocks/Collectables
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Savings & Investing Vocabulary
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Risk
•The possibility that your saving/invest will fail to produce a profit.
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Return
•The profit from your savings/investing
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Dividends
•Your profit when you own Stock (Shareholder/Stockholder)
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Capital Gains
•Your profit when you sell your asset (Real Estate)
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Interest
•The profit from savings/investing• Certificate of Deposit• Savings Account• Bonds
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Liquidity
•How long it takes for you to get cash out of your account and in your hand.
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Diversification
•When you invest your money into several different types of accounts•Some money into:
•Savings•CD•Bonds•Etc.
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Retirement
•Saving money while you are working for when you are old enough to stop working (60 years old+)• Usually Invested (long term goal)• Mutual Funds• IRA’s (Roth & Traditional)• 401K• Employer Sponsored
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Simple Interest
•Earning Interest on the principal investment
•Principal x Rate x Time
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Compound Interest
•Earning Interest on the Principal and Interest
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Principal
•The initial amount of the investment/savings
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The Rule of 72
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What is does
•Tells you how long it takes to double your money
• 72 = # of years
% Rate