DIVERSIFICATION PORTFOLIO

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• Savings bond (10,000)
• Stocks(10,000)
• Savings account (40,000)
• Certificate of deposit (20,000)
• Mutual funds(20,000)

SAVINGS BOND

DEFINITION

INTEREST RATE

RISK AND FACTS

• The risk of is very low due to the fact that you at least get the money you invested back.
• There are two types series EE and series I
• You can only purchase 10,000 of each series per year.

HOW TO OPEN A SAVINGS BOND

• You can open an account through treasury direct.
• These are also able to be given as a gift.

WHY?

• I chose this tool because it is very reliable you know your money is going to be safe here.
• I put 10,000 in because I want to make sure I won't lose all my money and some of it would be safe.

STOCK SHARE

DEFINITION AND INTEREST RATE

• Stock is a share in the ownership of a company.
• Interest rate of stocks varies drastically based on whether the company is doing good or not.

RISK AND FACTS

• The risk is relatively high but the payout can be great.
• The worst month for the stock market is October this has been the time in which two of the worst crashes occurred.
• Changes in stock prices were expressed as fractions until the year 2000

WHERE AND WHY?

• The biggest way people invest nowadays is online it's the quickest and easiest solution.
• I chose to invest 5000 because I don't want to invest too much into a risky business but I would still like the opportunity to make some money.

SAVINGS ACCOUNT

DEFINITION AND INTEREST RATE

• A bank account that earn interest.
• The average interest rate is .06%

RISK AND FACTS

• This is a very low risk because you will get your money back but the profit is also extremely low.
• Online savings accounts offer the best interest rates
• You can use your savings as an overdraft account.

WHERE AND WHY?

• To open a savings account you need to go to your bank.
• I put a majority of my money in here because I wanted to make sure my money is save.

CERTIFICATE OF DEPOSIT

DEFINITION AND INTEREST RATE

• A certificate issued by a bank to a person depositing money for a specific length of time.
• Average interest rate is 1.10%

RISK AND FACTS

• The risk is low to moderate your profit is going to be decent.
• Good for people with extra cash who won't need it for an extended period of time.
• Different from savings accounts because you have to deposit a certain amount.

WHERE AND WHY?

• You have to go to your bank to get a certificate of deposit.
• I chose this because it has a little better interest rate then a savings account but my money is still safe.

MONEY MARKET FUND

DEFINITION AND INTEREST RATE

• A open ended mutual fund that invests in short term debt securities.
• Interest rates vary

RISK AND FACTS

• Low risk
• Two types taxable and tax free
• Money market funds are not guaranteed by the fdic

WHERE AND WHY?

• Most common way to get a mutual fund is online
• I chose this because it is another way to save money but also keep it safe.

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• Diversification is important because it gives you multiple opportunities to make and save money.
• It's important to switch what tools you use because the economy is always changing so staying with the same tool can be costly.