Savings and Investment Strategies

Marissa DoriaBlock 3

SavingsStorage of money for future use

Compound InterestCompound on the amount saved plus the interest

previously earnedIt is important to invest regularly to keep your savings

growth rate high

Certificate of DepositAllows you to earn a higher interest rate than a regular

savings accountIt requires a minimum deposit of $100 to 1,000 or more

Money Market AccountPays a variable interest rate based on various

government and corporate securitiesA typical interest rate on a Money Market Account is 4-

5%

Mutual Funds vs StockMutual Funds—Allow investors to spread out their risk

among many investmentsStock—Ownership in a corporation

Common Alternative InvestmentsReal EstateCommoditiesCollectibles

What would the difference between a $100 Investment for 20 yrs at 5%, 8% and 10% Interest?41,928.43

LiquidityEase with which an investment can be changed into cash

without losing its valueIt is important because it is investments that can be

quickly turned into money

Common and Preferred StockCommon Stock represents general ownership in a

corporation and a right to share in its profitsPreferred Stock has priority over common stock in the

payment of dividends

NYSENYSE is the New York Stock Exchange is the best known

stock exchangeThe traders own or stock and trade among them

NASDAQNational Association of Securities Dealers Automated

Quotations: a computerized data system to provide brokers with price quotations

They exchange traded funds and stock