1. Chapters 17-20
Saving & Investing

2. Performing a Financial Checkup
Saving and Investing
Chapter 17
Section 1
Preparing for a Savings or Investment Program
Performing a Financial Checkup
Preparing for a Financial Crisis
Establish a larger emergency fund.
Know what you owe.
Reduce spending.
Pay off credit cards.
Apply for a line of credit at your financial institution.
Notify creditors if you are unable to make a payment.
Monitor your investments and retirement accounts.

3. Getting the Money Needed to Start an Investment Program
Saving and Investing
Chapter 17
Section 1
Preparing for a Savings or Investment Program
Getting the Money Needed to Start an Investment Program
Sources of Money to Invest
Pay Yourself First
Employer-Sponsored Retirement Plans
Elective Savings Programs
Special Savings Effort
Gifts, Inheritances, and Windfalls

4. Long-Term Investment Programs
Saving and Investing
Chapter 17
Section 1
Preparing for a Savings or Investment Program
Long-Term Investment Programs

5. Making Investment Decisions
Saving and Investing
Chapter 17
Section 1
Preparing for a Savings or Investment Program
Making Investment Decisions
Inflation Risk
Interest Rate Risk
Five Components of Risk
Business Failure Risk
Financial Market Risk
Global Investment Risk

6. Making Investment Decisions
Saving and Investing
Chapter 17
Section 1
Preparing for a Savings or Investment Program
Making Investment Decisions
Sources of Investment Income
Savings accounts
Certificates of deposit (CDs)
U.S. Savings Bonds
U.S. Treasury bills
Corporate bonds
Preferred stocks
Mutual funds
Real estate
Commodities
Precious metals
Gems
Collectibles

7. Questions to Ask Before Investing in a Piece of Real Estate
Saving and Investing
Chapter 17
Section 2
Savings and Investment Options
Types of Investments
Questions to Ask Before Investing in a Piece of Real Estate
Why are the present owners selling?
Is the property in good condition?
What is the condition of other properties in the area?
Is there a chance the property will decrease in value?
Will you be able to find an interested buyer?
Can an interested buyer get the financing to buy the property?

8. Developing a Personal Investment Plan
Saving and Investing
Chapter 17
Section 2
Savings and Investment Options
Developing a Personal Investment Plan

9. Financial Planners 17 Saving and Investing Section 3
Chapter 17
Section 3
Reducing Risk and Sources of Information
Financial Planners
Types of Financial Planners
Fee-Only Planners
Fee-Offset Planners
Fee-and-Commission Planners
Commission-Only Planners

10. Basic Services of a Good Financial Planner
Saving and Investing
Chapter 17
Section 3
Reducing Risk and Sources of Information
Financial Planners
Basic Services of a Good Financial Planner
Assess your current financial position
Offer a clearly written plan with recommendations
Discuss the plan with you and answer questions
Help you keep track of your progress
Guide you to other financial experts as needed

11. Financial Planners 17 Saving and Investing Section 3
Chapter 17
Section 3
Reducing Risk and Sources of Information
Financial Planners

12. Managing Your Investments
Saving and Investing
Chapter 17
Section 3
Reducing Risk and Sources of Information
Managing Your Investments
What Should You Do to Manage Your Investments?
Think About Tax Considerations
Evaluate Investments
Monitor Investments

13. Managing Your Investments
Saving and Investing
Chapter 17
Section 3
Reducing Risk and Sources of Information
Managing Your Investments
Taxable Income Includes
Interest Income
Rental Income
Dividends

14. Common Stock Why Investors Purchase Common Stock 18 Stocks Section 1
Chapter 18
Section 1
Common and Preferred Stocks
Common Stock
Income from Dividends
Why Investors Purchase Common Stock
Appreciation of Stock Value
Increased Value from Stock Splits
Voting Rights and Control of the Company

15. Preferred Stock Why Do Investors Purchase Preferred Stock? 18 Stocks
Chapter 18
Section 1
Common and Preferred Stocks
Preferred Stock
Why Do Investors Purchase Preferred Stock?
Considered a Safer Investment than Common Stock
Considered a Predictable Source of Income

16. Sources of Evaluating Stocks
Chapter 18
Section 2
Evaluating Stocks
Sources of Evaluating Stocks
Finding Information for Evaluating Stocks
Newspapers
The Internet
Stock Advisory Services – Standard & Poor’s Stock and Bond Guide – Value Line Investment Survey – Mergent’s Handbook of Common Stock
Corporate News Publications – Annual Reports

17. Factors That Influence the Price of Stock
Stocks
Chapter 18
Section 2
Evaluating Stocks
Factors That Influence the Price of Stock
Current Yield
Total Return
Numerical Measures for a Corporation
Earnings Per Share
Price-Earnings (PE) Ratio
Projected Earning

18. The Fundamental Theory The Efficient Market Theory
Stocks
Chapter 18
Section 2
Evaluating Stocks
Investment Theories
The Fundamental Theory
Assumes that a stock’s real value is determined by looking at the company’s future earnings
The Technical Theory
Based on the idea that a stock’s value is really determined by forces in the stock market itself
The Efficient Market Theory
Stock price movements are purely random

19. How to Buy and Sell Stock
Stocks
Chapter 18
Section 3
Buying and Selling Stocks
How to Buy and Sell Stock
Ways to Buy and Sell Stock
Full-Service Brokerage Firm
Discount Brokerage Firm
Trade
Stocks Online
The biggest difference is the commission.

20. How to Buy and Sell Stock
Stocks
Chapter 18
Section 3
Buying and Selling Stocks
How to Buy and Sell Stock
Types of Orders
Market Orders
Limit Orders
Stop Orders
More and more people are using their computers to make securities transactions.

21. Investment Strategies
Stocks
Chapter 18
Section 3
Buying and Selling Stocks
Investment Strategies
Long-Term Techniques
Short-Term Techniques
Buy-and-Hold
Buying on Margin
Dollar Cost Averaging
Selling Short
Direct Investment and Dividend Reinvestment Plans

22. Why Do Corporations Sell Bonds?
Bonds and Mutual Funds
Chapter 19
Section 1
Corporate and Government Bonds
Corporate Bonds
Why Do Corporations Sell Bonds?
To raise money when they can’t sell stock
To finance regular business activities
To reduce tax burden

23. Why Investors Buy Bonds
Bonds and Mutual Funds
Chapter 19
Section 1
Corporate and Government Bonds
Why Investors Buy Bonds
Why Are Bonds Considered a Safe Investment?
Interest income
Increased value over time
Face value is repaid at maturity

24. Government Bonds and Securities
Bonds and Mutual Funds
Chapter 19
Section 1
Corporate and Government Bonds
Government Bonds and Securities
Treasury Bills
Treasury Notes
Government Bonds and Securities
Treasury Bonds
Treasury Inflation-Protected Securities (TIPS)
Series EE Savings Bonds
Series I Savings Bonds

25. Determining Investment Value
Bonds and Mutual Funds
Chapter 19
Section 2
Investing in Bonds
Determining Investment Value
Sources of Information on Bonds
Government Reports and Research
Annual Reports
The Internet
Business Magazines

26. Determining Investment Value
Bonds and Mutual Funds
Chapter 19
Section 2
Investing in Bonds
Determining Investment Value
Bond Ratings

27. Determining Investment Value
Bonds and Mutual Funds
Chapter 19
Section 2
Investing in Bonds
Determining Investment Value
Bond Ratings

28. Defining Mutual Funds What Is a Mutual Fund?
Bonds and Mutual Funds
Chapter 19
Section 3
Mutual Funds
Defining Mutual Funds
What Is a Mutual Fund?
A mutual fund is an investment alternative in which investors pool their money to buy stocks, bonds, and other securities based on the selection of professional fund managers who work for an investment company.

29. Professional Management
Bonds and Mutual Funds
Chapter 19
Section 3
Mutual Funds
Defining Mutual Funds
Why Buy Mutual Funds?
Professional Management
Diversification

30. Making an Informed Decision
Bonds and Mutual Funds
Chapter 19
Section 4
Investing in Mutual Funds
Making an Informed Decision
Sources of Information on Mutual Funds
Newspapers
Quotations
Prospectuses
Annual Reports
Financial Publications
Professional Advice
Internet

31. Real Estate and Other Investments
Chapter 20

32. Real Estate Investment: Pros and Cons
Real Estate and Other Investments
Chapter 20
Section 1
Real Estate Investments
Real Estate Investment: Pros and Cons
Illiquidity
Declining Property Value
Disadvantages of Real Estate Investments
Lack of Diversification
Lack of a Tax Shelter
Management Problems

33. The Fluctuating Price of Gold
Real Estate and Other Investments
Chapter 20
Section 2
Precious Metals, Gems, and Collectibles
Gold
The Fluctuating Price of Gold
The price of gold rises when people believe that war, political unrest, or inflation may be coming.

34. Gold 20 Real Estate and Other Investments Section 2
Chapter 20
Section 2
Precious Metals, Gems, and Collectibles
Gold

35. Other Precious Metals 20 Real Estate and Other Investments Section 2
Chapter 20
Section 2
Precious Metals, Gems, and Collectibles
Other Precious Metals
Other Precious Metals That Rise in Value in Uncertain Times
Silver
Platinum
Palladium
Rhodium
Why Are Precious Metals Tricky?
Storage
Correctly predicting the market

36. Real Estate and Other Investments
Chapter 20
Section 2
Precious Metals, Gems, and Collectibles
Precious Gems
The primary risk of precious gems is the great fluctuation in prices, which can be influenced by global, economic, and political factors.

37. Stocks and bonds have proven to be the most stable type of investment.
Real Estate and Other Investments
Chapter 20
Section 2
Precious Metals, Gems, and Collectibles
Planning Investments
Stocks and bonds have proven to be the most stable type of investment.

38. Assignment
Using these power points and what we discussed in these four Chapters, write a paragraph describing what types of investments you plan on investing in and WHY? you chose these. Are you a risk taker or not?
You MUST discuss AT LEAST three different types of investments.