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The higher the rate of intrest you earn, the more money you are likely to have.
Saving -what people do to meet short-term goals. Your money is very safe in a savings account, and it is usually earning a small amount of intrest. It's also easy for you to get your money when you need it- all you hvae to do is go to your local bank and make a withdraw.
Compounding, or compound intrest, is the idea of earning intrest on intrest. Think of it as super-sizing you account, because it is one of the most powerful principles inpersonal
Stock Market -The place where stocks are bought and sold. They think about the risk of losing all of their money. But risk is simply the uncertainty that the anticipated return will be achieved. The risk/reward trade-off is the principle that an investment must offer higher potinental returns to compensate for the potinenial unpredictability.
Unit Three
Investing -you're setting aside money for a long-term goal. There's no guarantee that the money you invest will grow. In fact, it's normal for investments to rise and fall in value over time. But in the long run, investments can earn a lot more than you can usually make in a savings account.
Did you Know? Intrest=Principal*Intrest Rate*time
U.S. Savings Bonds -the federal government pays intrest to investors for loaning it money, just like banks and credit unions do. But bonds are from savings accounts. A Bond is a formal were the borrower, in this case the federal government can use your money for a set amount of time, and you, as the lender, well get paid a specific amount of intrest in return. Saving Bonds are designed to be held for up to 30 years. So don't casha savings bond in 6 year or you will be fined.
Certificates of Deposit (CDs) -Banks and Credit Unions have their own versions of savings bonds called certificates of deposits. When you buy a CD from on these financial institutions you are assentially loaning it money for a set period of time, and getting intrest in return.
Money Market Depoist Accounts Banks and Credit Unions also offer money market deposit accounts (MMDAs). These work like checking accounts, so you can take your money out whenever you want, usually without any penalty. However, the bank or credit union may limit the number of checks you can write per month. MMDAs pay a higher rate of intrest than savings accounts, so choose wisely.
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