Browse Month: December 2017

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Having “The Talk” About Making Your Money Work Harder: Part 4 – Stocks

Welcome back to our five part series on making your money work harder! This series is part of a BIG conversation I had with J where we talked about other ways to invest his money beyond the Bank of Mom.

In part 1, we talked about savings accounts, in part 2 savings bonds, in part 3 CDs and now for part 4, my favorite conversation, stocks.

What are stocks?

A stock is a piece of a company. People buy stocks (or shares) of a company, and with that money, the company can grow their operations. When you own stock in a company, you actually own a piece of that company!

How much does it cost to buy stocks?

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Having “The Talk” About Making Your Money Work Harder: Part 3 – CDs

Welcome back to our five part series on making your money work harder! This series is part of a BIG conversation I had with J where we talked about other ways to invest his money beyond the Bank of Mom.

In part 1, we talked about savings accounts, in part 2 we discussed savings bonds and now here’s a recap of our conversation on CDs.

What are CDs?

CD stands for “Certificate of Deposit” and you can open one at your bank or credit union. CDs are very similar to standard savings accounts except you deposit a fixed amount of money for a fixed period of time at a guaranteed interest rate.

CDs typically earn a higher interest rate than standard savings accounts. In reference to our series here, CDs are making our money work the hardest so far — harder than both savings accounts AND savings bonds. (Well… except the Bank of Mom, which pays quite a bit.)

Additionally, you can earn a higher rate with a larger opening deposit and a longer term.

Some banks offer standard CDs only, and other banks may have additional types. Ally offers three types of CDs — a High Yield CD, a No Penalty CD and a Raise Your Rate CD.

When your CD matures (meaning that your fixed period of time is up), you’ll get a notice from your bank or credit union. At that time, you can either cash it out (receiving the principal plus interest) OR roll the money over into a new CD (and potentially add funds to it at this time).

What are the Pros and Cons?

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