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Whether you have saved a few million from your playing days or if you don’t have two nickels to rub together, the principles for saving and investing are the same.

Right off, let’s define the terms.  Saving speaks of guarding your money.  Investing speaks of growing your money.  While both saving and investing have some risk, investing has more risk.  As you know, with risk comes reward.

You probably already have a savings account at your bank.  Interest rates here have gone to virtually zero.  Your money is relatively safe here, but it is not working for you.

Defining the Terms

Debt Instruments

Investments are broken into two parts: debt and equity.  On the debt side you find things like bonds.  A bond is a loan that you make to someone, and they are obligated to (1) pay you back and (2) pay you interest.  This might be a great place for you to invest.  But, avoid junk bonds.  Aim for bonds that are safe, like US Treasury Bonds, or highly rated corporate or municipal bonds.


Equity investments are things like stock, or funds that are made up of different stocks.  Like bonds, there are some that are riskier than others.  There are some that pay returns now, some that pay later, and some that pay both now and later.


The key in all of this is balance.  You want to both guard and grow your money.  In the world of financial services, this is called diversification.  Your dollars should be spread out into different types of investment vehicles.  Some large with companies, some small.  Some that are long-term, Steady-Eddie type, some that are growth stocks.  Some in the US, some international.  You might want some stock in retail, hospitality, energy, healthcare or manufacturing.  The sky’s the limit.


Your collection of investments of all types is called your portfolio.  Do you best to guard and grow your assets!


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