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Investments: Simplified. Adult Living. What is investing?. Investing is a way to make money with your money. First you have to make money Try to SAVE some money in a highly liquid account. NEXT, make your money grow through investing. Why should I invest?. Two main reasons:

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Presentation Transcript
what is investing
What is investing?
  • Investing is a way to make money with your money.
  • First you have to make money
  • Try to SAVE some money in a highly liquid account.
  • NEXT, make your money grow through investing.
why should i invest
Why should I invest?
  • Two main reasons:
    • To stay ahead of inflation
    • To achieve financial goals
when should i invest
When should I invest?

THE SOONER THE BETTER!!!!

Let the “snowball” work for you!!!

what are the risks
What are the risks?
  • Losing money
  • Risk normally works proportionately with reward….

the lower your risk (conservative investments) the lower your reward

the bigger your risk… the more the possible reward

slide6
Who?
  • Everyone who is making money should be investing AFTER setting up a savings account with 3-6 months worth of income saved.
  • There are different types of investors – conservative (low-risk takers) and more aggressive (risky) YOU may be one of these or a combination throughout your life depending on your goals.
savings accounts
Savings Accounts
  • 1st “investment”
  • Set up at a bank
  • Should have 3-6 months worth of income in it
  • Highly liquid
  • No risk- FDIC
  • LOW interest
slide8
CDs
  • Certificates of deposits
  • YOU decide the length of time (3mon- 15yrs) YOU decide the amount ($100-$250,000)
  • Bank determines interest rate for your CD.
  • GREAT first investment!!
treasury bills
Treasury Bills
  • Backed by the U.S. government
  • Range in price from $1,000-5 million
  • Avaliable in 1 month, 3 month, and 6 month maturities
  • Low risk (FDIC)
  • Low return (BUT over short time)
bonds
Bonds
  • Corporate or Government bonds- they sell bonds- you loan them money- they repay in a set period of time (usually LONG-5-25 yrs)
  • Higher interest (compared to savings or CD)
  • Not liquid- penalized if “cashed” early
  • If the company bankrupts- you MAY not get paid (but will be paid before stockholders)
stocks
Stocks
  • You own a little piece of the company
  • If the company does well… your little piece of it does well (profits)
  • If the company bankrupts you lose you money
  • Risk & reward depends on the companies you choose to invest in.
  • Not very liquid- need to sell your piece before you get the $
real estate
Real Estate
  • Purchasing property or land for the purpose of resale
  • Time consuming
  • Expensive initial investment
  • Potential rewards- HIGH, risk-HIGH
  • Takes some knowledge of the R.E. “market”- when/where to buy and possibly “flipping” knowledge/ability
commodities
Commodities
  • Oil, gold, silver, metals
  • Investing in our future need for this product- can be speculitive
  • Low interest but steady income
collectables
Collectables
  • Items that increase in value due to time/ demand
  • Coins, stamps, baseball cards, beanie babies, etc
  • Can’t count on future demand for these items
  • Usually need to preserve the item for best value
  • Can make $ off “things” you don’t need/want anymore
mutual funds
Mutual Funds
  • A “bucket” of stocks or bonds
  • Professionally managed
  • Diversification reduces risk
  • Risk depends on what is in your “bucket”
  • Liquidity depends on what is in your “bucket”
  • Great for an investor who doesn’t want to constantly monitor your investment
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