1. Personal Savings and Investment #46
EMNC(SW/AW) Smith, William J.
NPTU Charleston CCC

2. Objectives
Discuss the importance and options available for money growth through savings and investments
How to make your money work for you!

3. Risk vs. Reward (Younger) More risk/More Growth; Less Stability
(Older) Less Risk/Less Growth; More Stability
Portfolio Rule of Thumb:
Age = The % of Fixed Income vs. Equity

4. Investment Management
Broker Managed
Do your homework on your prospective broker
Self-Investing Online
Time consuming
No broker fees

5. Investment Metrics Rule of 72 Market Index
Years required to double investment = (72) ÷ (compound annual interest rate)
@ 7.2% your money doubles every 10 years
Market Index
S&P 500, NASDAQ, Dow Jones Industrial
Good comparator with investment portfolio growth

6. Savings Accounts Banks Credit Unions FDIC/NCUA Insured
Flexibility vs. Interest Rates

8. Bonds
Debt investment loaned to an entity for a period of time at an interest rate
Interest paid in Coupons
Investor paid the face value of the bond at the maturity date
Market price varies depending on a number of factors
Credit quality of the issuer
Length of time until maturity
Coupon rate vs General interest rate environment at the time

9. Certificate of Deposit (CD)
Insured Savings Accounts issued by Banks or Savings & Loans
Normally has a minimum deposit, fixed term, and interest rate
Interest rates slightly higher than general savings accounts

10. Stocks Ownership stake in a company
Claim on part of the companies assets and earnings
Dividends issued to shareholders as distribution of earnings
Do your homework on the company!

11. Mutual Funds Pool of funds for the purpose of investing in securities
Money Manager manages the investment portfolio for the fund
Capital Gains paid to investors for sale of securities for profit or coupons for bonds
Dividends paid for equity at specified intervals
Fund prospectus will layout the investment objectives for the fund

12. Resources www.saveandinvest.org www.militarymoney.com
Command Financial Specialist
Fleet & Family Support Center

13. Questions?