1. T HE S ECRET T O G ETTING R ICH !!

2. T HE S ECRET OF B ECOMING R ICH ! Save at least 10% of your income and never spend it, but INVEST it. Never spend the principal, but accumulate enough wealth to live off the interest/investment income. Fun Fact! $100 a month saved for 45 years at 14% compound interest is $1,228,800! Anyone can be a millionaire!!!

3. W OULD Y OU R ATHER... Would you rather I gave you one million dollars today or a penny today and then doubled it every day for 30 days? $0.01 doubled every day for 30 days = $10,733,418.00

4. I NVESTMENT D EFINITIONS Compound Interest: earning interest on the previous interest. The interest must be left in the investment. Risk: the chance of losing invested money. Rate of Return: determined by the interest rate and the amount of the investment. Liquidity: how easily the investment can be turned into cash. Term: the time after which the interest is paid or the investment no longer pays interest.

5. I NVESTING F INANCIAL R ESOURCES AKA M ONEY

6. C HEQUING A CCOUNTS Bank accounts from which cheques can be written. The Canadian Deposit Insurance Corporation (CDIC) covers up to $60,000. Risk: none Return: almost none Liquidity: very high Term: none

7. S AVINGS A CCOUNTS Bank accounts used for saving money. The CDIC covers up to $60,000. Risk: none Return: very low Liquidity: high Term: daily or monthly interest

8. T ERM D EPOSITS, G UARANTEED I NVESTMENT C ERTIFICATES (GIC’ S ) Money that is deposited for a set length of time: ie. 1, 2, 3, 4, or 5 years. There is a financial penalty if the money is withdrawn before the agreed upon period. Risk: low Return: low to medium, dependent upon length of term Liquidity: low Term: 1, 2, 3, 4, or 5 years

9. C ANADA S AVINGS B ONDS Bonds (lending money) issued by the federal government at an established interest rate. There are two kinds: one that may be liquidated and on that may not. Risk: very low Return: low to medium Liquidity: low or high, depending on type Term: 9 years

10. M ORTGAGES Lending people money to purchase buildings and/or property. The buildings and/or property are established as collateral. Risk: low to medium Return: medium Liquidity: low (buildings or land must be sold) Term: up to 35 years

11. R EGISTERED R ETIREMENT S AVINGS P LAN (RRSP) Any investments that are at least 80% Canadian are registered with the federal government as an RRSP. In addition to the tax free interest paid by the investment, the government provides a tax credit on the principle equal to the investor’s tax bracket. Risk: low to high (depending on the investment) Return: high (because of the tax credit) Liquidity: low (taxes are paid when withdrawn) Term: depends on investment

12. S TOCK M ARKET Bonds: lending a company money for an agreed upon interest rate. Stocks: owning a part of a company. Shares in the company increase in value with the value of the company and the demand for shares. Risk: medium to high Return: loss of investment to super high Liquidity: low to medium Term: none

13. R EAL E STATE Purchasing buildings or property to rent. Risk: medium to high Return: medium to high Liquidity: very low Term: none

14. G OLD, S ILVER & C OLLECTIBLES Purchasing valuable commodities that increase in value over time. Risk: medium to high Return: low to medium Liquidity: low to medium Term: none

15. M UTUAL F UNDS Money pooled by many investors in a mutual fund company of professional financial experts who research the stock and bond markets to invest in a particular sector. There are bond funds (low risk), balanced funds (medium risk) and equity funds (high risk). Risk: medium to high Return: low to high Liquidity: medium (takes about a week to liquidate) Term: three year minimum is recommended

16. P YRAMID O F I NVESTMENT R ISK If you had $10,000 to invest, which of the options would you choose, or would you divide the money into several investments? Approx. $2000 in low risk, $4000 in medium risk, and $4000 in high risk is a good choice for a young person. The older you get, the less risk you should take. It would be imprudent to put all $10,000 into one investment, especially a high risk one.