1. Mr. Stasa- Willoughby-Eastlake City Schools
Investing 101 Part 1
Mr. Stasa- Willoughby-Eastlake City Schools

2. Planning Goals Wisely Short-term goals should be planned using savings
Money that is guaranteed to be there
Long-term goals should be planned through investments
Money that will grow more, but take longer

4. REVIEW… Financial planning Financial Goals must be S-M-A-R-T
Short-term goals
Intermediate Goals
Long-term goals
Financial Goals must be S-M-A-R-T
Specific
Measurable
Attainable
Realistic
Time-bound

5. What’s an Investment?
An investment is an asset an investor buys in hopes of it being worth more in the future.
Investments include (but not limited to):
Stocks
Bonds
Mutual Funds
Real Estate
Collectibles

6. Current U.S. Rate of Inflation:
Why Invest?
Make your money grow!
Build your wealth at rates that will exceed inflation (the rise in the level of prices over time)
Have a regular source of income
Current U.S. Rate of Inflation:
0.8%
(As of Dec. 2014)

7. U.S. Stocks had an average return of 13.8% in 2014
Rates are in your favor
The U.S. inflation rate increases on average about 2% per year
The average U.S. savings account interest rate is less than 1%
The growth of the average U.S. stock has a return of 10% per year
A return is an annual rate of growth
U.S. Stocks had an average return of 13.8% in 2014

8. What Would You do?
If you were handed $1,000 today, what would you do with it?
Let it set under your mattress
Place it into a savings account
Invest it in stocks?

9. Purchasing Power
Purchasing power the amount of goods (aka investments) you can buy with your money

10. Why Learn About Stocks?
The stock market is the core of America’s economic system
Stock is a share of ownership in the assets and earnings of a company
Bond is a type of debt that a company issues to investors for a specified amount of time.
Stock market is a general term used to describe all transactions involving the buying and selling of stocks and bonds issued by a company

11. 9 Stock Industry Sectors
Entertainment
Capital Goods
Communication
Consumer Goods
Energy
Financial
Health Care
Technology
Transportation

12. Why Companies Issue Stock
When a company would like to grow, it issues stocks to raise funds and pay for ongoing business expenses

13. Two Types of Investors
Growth Investor: Growth investors buy investments that will increase in value over time- selling the investments later for a higher price.
Income Investor: Income investors buy investments that provide regular cash payments.