1. Investment You will not be able to work forever and saving for retirement becomes a must = financial goals must be made for financial security. Investing in stocks and bonds can lead to bigger returns then interest in a bank account. Stock: a piece or share of a company and when purchased gives you partial ownership of the company. Company does well = stock value Increases Company does not do well = stock value decreases The hope is to sell the stock for more then you paid, earning you a profit.

2. Dividends Dividends: some companies pay shareholders a portion of company earnings depending on the amount they own. Stocks can bring great wealth but also great risk. Bank accounts are insured, guaranteeing your money. There is no guarantee in stocks and if a company goes out of business, you lose everything.

3. Bonds Bonds: lending money to a company or government with promise to be paid back with interest. Company bonds: companies do this to raise money for expenses (equipment, research) but the risk is the company may not be able to pay. Government bonds: also raises money for expenses but is a safer bet of return.

4. Other ways to invest Mutual Funds: pools of money from many people that are invested in a selection of stocks and/or bonds chosen by experts. A government regulated index like the Dow Jones track mutual funds and stocks to show prices over the long term. Money market funds: like a checking account where you write checks for larger amounts against the money you deposited. They typically over higher interest rates then savings accounts. Certificate of deposits: an agreement with a financial institution to deposit money for a certain length of time for a guaranteed set rate of interest. (negatives= can’t just withdraw, not liquid)