Cash equivalents, bonds, and stocks are three common investments you're likely to know. The time horizon you're on might help you decide which investment to use.
Bonds, for example, are loans you make to another entity. In most cases, the bonds you'll invest in are from a corporation, municipality, or government. Bonds are considered a medium risk and reward.
If you're wanting to invest over a longer period of time, stocks are a great option. Stocks offer partial ownership in a public company.
Refer to the downloadable Just the Facts: Investing Worksheet to help you think through how to use these three investments.
Your Chapter 5 Checklist:
- Watch the Common Investments video
- Download the Just the Facts: Investing Worksheet
- Understand how different investments align with your tolerance profile and timing