Knowing Investment Basics Should Be Mandatory for All, It Can Mean Wealth or Not.Investment Basics. An investment basically means risking your money for the expectation of getting that money and more back at some time in the future. Investing is different than savings because of the risk factor but also because you can expect to get much more back if you are successful. Investing makes more sense than saving in a number of situations and is the means more suited to helping you become wealthy (not that investing will automatically make you so). Items such as a college savings plan, your retirement, additional income, and what you will leave for your successors can be addressed with various types of investments. There are countless places in which you can elect to put your money in exchange for the promise of having more money in the future but we will discuss just a few of the basics. Remember that’s what this site is intended for, personal finance basics. We will focus on stocks, bonds, and mutual funds as these are three of the most common investments. Chances are that many of you already have a stake in one or all of these. 401k or 403b retirement plans at work are vested in these. If you are one of the fortunate ones that has a company pension plan, you already have an interest in these tools as well. College savings plans and IRAs are also common means by which individuals may not even realize they are invested in the stock market or bonds. Investments are a key ingredient in achieving financial goals so it is very important that you learn the basics of the various types and make use of those that you find best suited for your own personal finance needs.
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