| Fifty years ago, the average worker | | | | potential |
| didn't need to worry about saving for | | | | -Mid-Cap stocks, lie between the |
| his retirement. If he stayed with the | | | | large-cap and small-cap risk range |
| same company for 20, 25 or 30 years, he | | | | Bonds: |
| was guaranteed a pension, in addition to | | | | Basically an IOU from a company or |
| a monthly social security check form the | | | | government, bonds are a relatively safe |
| United States government, and medical | | | | investment. Bonds are issued as a way |
| benefits under Medicare. Still, those | | | | for corporations and government agencies |
| same workers generally saved about 10% | | | | to raise money quickly. Bonds come with |
| of their paychecks for a rainy day, | | | | a guarantee that the purchaser will get |
| leaving many with a tidy retirement | | | | back their original investment, with a |
| fund. | | | | set amount of interest at a specific |
| Today's workers aren't offered those | | | | date. These fixed-income investments |
| same retirement benefits, yet, many fail | | | | come in several categories, or grades: |
| to put even 5% of their annual salary | | | | -AAA, AA or A offers relatively low risk |
| into a 401K retirement plan, let alone | | | | -BBB, are medium grade |
| save additional funds on top of that. | | | | -Bonds lower than BBB have higher risk |
| Today's worker, (no matter how much, or | | | | of default |
| how little they make), must become a | | | | -Junk Bonds, offer the highest risk, and |
| savvy investor in order to guarantee a | | | | are often worth nothing by their |
| comfortable future. | | | | maturation date |
| Whether you can put aside $50 a month, | | | | Cash Equivalents: |
| or $500, learning a few investment | | | | This is a type of short-term investment |
| basics is crucial in order to get the | | | | that is easily converted into cash, such |
| best future bang for your current buck. | | | | as Treasury or T-Bills ( a government |
| Here are a few of the most common | | | | note offering low interest) and money |
| investment opportunities available to | | | | market accounts, Although a safe |
| both the high and low-end investor: | | | | investment, their return can be rather |
| Stocks: | | | | low. |
| Stocks, or equities, are a way to invest | | | | Mutual Funds: |
| a small portion of ownership in a | | | | This popular investment is a simple way |
| specific company. The number of shares | | | | to expand your investment portfolio, by |
| that you buy, in proportion to the | | | | allowing investors to pool their money |
| number available, determines how much of | | | | in a collection of stocks, bonds, and |
| the company you actually own. Known as | | | | cash equivalents, in order to make the |
| the best opportunity for long-range | | | | most profit at the least risk. The |
| growth, stocks can be a risky short-term | | | | rationality with this type of investment |
| investment. | | | | is, if one fund does poorly, another |
| There are three types of stocks | | | | will make up for the loss. |
| available for purchase: | | | | Investing money wisely takes a little |
| -Large-cap stocks, from well-established | | | | research and experience, but today's |
| companies | | | | options make investing an option for |
| -Small-Cap stocks, represent | | | | just about everyone - no matter how much |
| lesser-known companies with fast-growth | | | | or how little they have to invest. |