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Investing and Saving: Project 3

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Raquel Davis

on 12 November 2014

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Transcript of Investing and Saving: Project 3

Investing and Saving: Project 3
Discuss the concept and purpose of personal finance
Break down the Project 3 Prompt
Review the requirements for each paragraph of the essay
Review a properly completed Works Cited

What is Personal Finance?
It is decision making skills which foster a person's individual standard of living.
Standard of Living is defined as "the degree of wealth and material comfort available to a person or community."
Use information wisely, which leads to better informed decisions and consumers, workers, and society.
Scarcity, Opportunity Cost, and Trade-Off's
Every decision that we make on a daily basis can impact our personal finances.
What decisions did you make today that had an opportunity cost or trade-off?

When setting goals for the future, no matter how close or far away, it requires discipline and planning.
What are the different steps needed in order for you to meet your goals for the future?
How Do You Save and/or Invest?
In order to meet your goals, you MUST have a PLAN.
There are a variety of OPTIONS available for SAVING
Saving accounts
Money Market accounts
Money jar
Safe Deposit Box
Certificate's of Deposit (CD's)
There are a variety of OPTIONS for INVESTING
Treasury Bills
Real Estate
Precious Metals
401k / IRA / Employer Directed
The Prompt as it is Written
In this project you will learn about savings and investments in your lifetime. This is the most practical of all of the projects in this course because you will learn about how to save and invest. This is a skill that you can carry with you into the future.

You will be using your writing skills to write a five-paragraph essay describing what investments are best suited to the different stages of a person's life.
The PRIMARY focus of this paper is to ANALYZE what investment options fit YOU best at the three main investment stages of your life.
Payoff and Risk
What is Payoff?
Payoff is the amount of money that is received in a certain amount of time

What is Risk?
Risk is the amount of opportunity available to make money

There is also a GREATER potential for a HUGE LOSS
What time in an investor's life do you think is the BEST time to consider HIGH Risk investments??
The THREE (3) Investment Stages
Young Adult Ages: 21-40
Mid-Life Ages: 41-60
Retirement Ages: 61+
Paragraph #1 Introduction (6-8 Sentences)
The Purpose for Investing
Catch the reader's attention with an interesting opening statement:
Fact about saving/investing
**Do NOT start with a Question**
Briefly introduce the topic of your paper to wet the reader's appetite:
Why do people save?
What do people hope to accomplish through investing?
Create your three-pronged THESIS statement that introduces the three stages and investment risk
Young Adult (High-Risk)
Mid-Life (Moderate Risk)
Retirement (Low Risk)
Sixty-three percent of all women over the age of thirty do not invest for retirement.
Many Americans choose to save part of their income. By saving and investing, they hope to save enough money to by a home, retire, and live comfortably.
YOUR TURN: Create a 3-Pronged Thesis statement that discusses the investment stages.
Provide a transition sentence to lead into the first body paragraph
Each stage is suited to specific types of investment options. The first stage holds the most risk.
Paragraph #2 - Body Paragraph (6-8 Sentences)
Young Adult Investing
State your main idea for this paragraph
This stage should include your highest risk investment
What are the payoffs and risks associated with this phase of investing? (Remember the correlation)
Why is this investment a good option for people starting out their investments?
The twenties and thirties are the perfect time for an individual to take the most risk in their investments.
High risk investments have the potential for a large payoff due to the short term and other factors..
These higher risk options are best to participate in when there are many years before retirement age.
What is the time table on the expected return for this investment? (How long before you cash out?)
Gains and losses can happen within hours, days, or weeks depending on the type.
Find a specific example, such a particularly high risk stock, that supports your decision to choose this investment. (Keep this BRIEF)
Keep evidence for support
A good example of a high risk investment is pharmaceutical stock. The past year these stocks have increased over 75% in value according to the S&P 500.
Transition to the next stage for investing.
YOUR TURN: Write a transition sentence from Young Adult to Mid-Life investing.
Paragraph #3: Body Paragraph (6-8 Sentences)
Mid-Life Investing
State the main idea for this paragraph.
Mid-Life Investing (Moderate Risk)

What are the payoffs and what are the risks associated with a moderate investment?

Why is this type of investment a good option for mid-life investing?

What is the time table for the expected return on this investment?

Why is it good for this stage?

List a specific example of an investment that has MODERATE risk.
Provide evidence to support your choice.

Transition to Retirement Age investments.
Paragraph 3 Example:
As a person moves into middle age, it is important to adjust the amount of risk. Moderate risk investments usually have less payoff because they are not as volatile. They are not supposed to be quick money makers. This is perfect for middle age because there is less risk of losing the money that has already been made earlier in life. The expected return is usually closer to retirement age. An excellent example would be investing in Fidelity's Allocation Fund. It combines stocks and fixed income, which balances out the risk. The final investment stage is the longest of all of them.
Paragraph #4: Body Paragraph (6-8 Sentences)
Retirement Stage
State the main idea for this paragraph
Retirement stage investments should have little to no risk

What are the payoffs and risks associated with this type of investment?

Why is this investment a good option for retirement age?

What is the time table for the return on this investment? Why is this the case?

List a specific example that you would choose for this stage and provide evidence to support your choice.

Transition to your conclusion paragraph.
Paragraph #5: Conclusion (6-8 Sentences)
Restate your thesis (Not word for word)
Summarize the main points of your paper
What do you want the reader to remember about the three different investment stages?
Describe your overall viewpoints regarding the purpose of investing and how it should change over time.
Works Cited
Works Cited Example
URL https://www.fidelity.com/fund-screener/research.shtml
Works Cited Example
The final citations SHOULD NOT include the URL address.
The three citations should be in ALPHABETICAL order.

"Mutual Funds Research." Online Trading, ETFs, Mutual Funds, IRAs & Retirement. N.p., n.d. Web. 26 June 2014.

"OptionsXpress » Stocks, Options & Futures." Options Trading at OptionsXpress. N.p., n.d. Web. 26 June 2014.

"TREASURY SECURITIES & PROGRAMS." Individual. N.p., n.d. Web. 26 June 2014.

IMPORTANT Information
DUE Date: Friday, _________

DROP DEAD Date: Monday, _________

You MUST complete Lesson 15 BEFORE you are able to turn in the Project.

Do NOT email or message me your project to me. I cannot grade them unless they are submitted through the PSP.
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