Unit 3 - Investing: Making Money Work for You

1. Unit 3 - Investing: Making Money Work for You

2. Overview of Unit 3- Investing Activity from the curriculum Optional activities, supplementary materials Website suggestions Questions Agenda

3. Unit 3Target Competency Propose a personal saving and investing plan

4. Differentiate between saving and investing Assess the time value of money Compare investment options Compare the relationship between risks and returns related to saving and investments Recommend ways to integrate savings and investing strategies into financial planning Learning Objectives

5. Savings and Investments Unique Investment Features Unique Savings Features Common Features What are some features common to both investments and savings? 3-A

6. Time Value of Money Key Investments Principles Saving and Investment Choices In Unit 3

7. Compounding --Albert Einstein “Compounding is the 8th wonder of the world” Exercise 3B: The Power of Compounding Time Value of Moneypage 30 Student Manual

8. Amount Saved Per Week Value After 10 Years Investing Weekly at 5% Interest $ 7.00 $ 4,720 $ 14.00 $ 9,440 $ 21.00 $ 14,160 $ 28.00 $ 18,880 $ 35.00 $ 23,600 3-B 1

9. 72 Years Needed to Double Investment = Interest Rate 72 = Interest Rate Required Years Needed to Double Investment Rule of 72 Page 32- Student Manual 3-H

10. Time is money More time More money More interest More Money Key Investment Principle

11. Page 29 of Student Manual Page 67 of the Teacher Manual Who has the most?

12. Don’t have all your eggs in one basket Key Investment Principle Diversification

13. Commo- dities Penny Stock Speculative Stock / Bonds / Mutual Funds Collectibles Blue-Chip Common Stock Growth Mutual Funds Real Estate Balanced Mutual Funds High-Grade Preferred Stock High-Grade Convertible Bonds High-Grade Municipal Bonds or Mutual Funds Money Market Accounts or Mutual Funds High-Grade Corporate Bonds or Mutual Funds Insured Savings / Checking Accounts U.S. Savings Bonds Certificates of Deposit Treasury Issues FinancialPlanningPyramid Highest Risk Highest Earnings Lower Risk Lower Earnings 3-J

14. Exercise 3D: Risk vs. Reward Page 78 Instructor Manual Page 34 Student Manual Page 79 Answer key Instructor Manual Activity

15. Income Investments Lenders An Array of Investment Options Savings at 4% vs. Investments at 7.5%

16. Growth Investments Ownership Stocks Real Estate Collectibles An Array of Investment Options

17. Mutual Funds Income Growth An Array of Investment Options

18. $1,000.00 $1,000.00 $20.00 50.00 $19.39* 51.66 Dollar Cost Averaging One-Time Investment Dollar-Cost Averaging Shares Purchased Shares Purchased Amount Invested Share Price ($) Amount Invested Share Price ($) $1,000.00 $20.00 50.00 $100.00 $20.00 5.00 $100.00 $19.50 5.13 $100.00 $19.25 5.19 $100.00 $19.75 5.06 $100.00 $19.20 5.21 $100.00 $18.90 5.29 $100.00 $18.00 5.56 $100.00 $18.60 5.38 $100.00 $19.78 5.06 $100.00 $20.90 4.78 3-L * Average Share Price 1 2 3 4

19. Unit 3 SM3-1-Dollars and Sense SM3-2-Are You a Risk-Taker? Students talk with an adult about investment experiences Optional Activities Instructor Manual

20. Students take home a newsletter ( on CD) to read Students will ask their parents what they've learned about investing Taking It Home

21. http://hsfpp.nefe.org Student site

22. U.S Securities Exchange Commission http://www.sec.gov/investor/teachers.shtml Websites

24. www.smgww.org

25. www.tcalc.com www.tcalc.com/millionaire-calculator.html

26. 7% $183.55 a month

27. 10% $57.72 a month or $14.43 weekly or $2.06 a day

28. Create a personal savings and investing plan Assessment 3-1:My Investing Plan