Term of the Day... Tax-Deferred Savings Plan

Tax-Deferred Savings Plan

What Does Tax-Deferred Savings Plan Mean?
A savings plan or account that is registered with the government and provides deferral of tax obligations. Tax-deferred savings plans may defer taxable income earned within the account either until withdrawal or until a particular date.

They are used most commonly in retirement savings accounts such as IRAs, 401(k)s and RRSPs, but are also available for education savings plans and other accounts.

Investopedia explains Tax-Deferred Savings Plan
In Canada, the Registered Retirement Savings Plan (RRSP) is an example of a tax-deferred savings plan. The RRSP shelters what would normally be taxable income earned within the account until withdrawal. All profits within the account, including interest, dividends and capital gains, are taxed as income only upon withdrawal.

Essentially, tax-deferred savings plans allow you to use the taxes which would have gone to the government for investing. In the end, the taxes are paid, but not before the funds were used to make more money.

Losing Money? Don't Blame Your Broker

Losing Money? Don't Blame Your Broker

Wall Street has been home to more than its fair share of scandals dealing with everything from accounting, research and access, and initial public offerings. Maybe you've just lost a fortune in the market. The money is gone, and it must be somebody's fault. There must be some way to get the money back. The next step seems obvious: sue your broker. Click the link to continue.

Term of the Day... Bond

Bond

What Does Bond Mean?
A debt investment in which an investor loans money to an entity (corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used by companies, municipalities, states and U.S. and foreign governments to finance a variety of projects and activities.

Bonds are commonly referred to as fixed-income securities and are one of the three main asset classes, along with stocks and cash equivalents..

Investopedia explains Bond
The indebted entity (issuer) issues a bond that states the interest rate (coupon) that will be paid and when the loaned funds (bond principal) are to be returned (maturity date). Interest on bonds is usually paid every six months (semi-annually). The main categories of bonds are corporate bonds, municipal bonds, and U.S. Treasury bonds, notes and bills, which are collectively referred to as simply "Treasuries".

Two features of a bond - credit quality and duration - are the principal determinants of a bond's interest rate. Bond maturities range from a 90-day Treasury bill to a 30-year government bond. Corporate and municipals are typically in the three to 10-year range.

Term of the Day... Mutual Fund

Mutual Fund

What Does Mutual Fund Mean?
An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money mangers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated in its prospectus.

Investopedia explains Mutual Fund
One of the main advantages of mutual funds is that they give small investors access to professionally managed, diversified portfolios of equities, bonds and other securities, which would be quite difficult (if not impossible) to create with a small amount of capital. Each shareholder participates proportionally in the gain or loss of the fund. Mutual fund units, or shares, are issued and can typically be purchased or redeemed as needed at the fund's current net asset value (NAV) per share, which is sometimes expressed as NAVPS.

Are You Investing Or Gambling?

Are You Investing Or Gambling?

Merriam-Webster dictionary defines gambling as:

1. a: to play a game for money or property
   b: to bet on an uncertain outcome
   
   
2. to stake something on a contingency : take a chance.

Term of the Day... Bear Market

Bear Market

What Does Bear Market Mean?
A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment to be self-sustaining. As investors anticipate losses in a bear market and selling continues, pessimism only grows. Although figures can vary, for many, a downturn of 20% or more in multiple broad market indexes, such as the Dow Jones Industrial Average (DJIA) or Standard & Poor's 500 Index (S&P 500), over at least a two-month period, is considered an entry into a bear market.

Investopedia explains Bear Market
A bear market should not be confused with a correction, which is a short-term trend that has a duration of less than two months. While corrections are often a great place for a value investor to find an entry point, bear markets rarely provide great entry points, as timing the bottom is very difficult to do. Fighting back can be extremely dangerous because it is quite difficult for an investor to make stellar gains during a bear market unless he or she is a short seller.

Term of the Day... Bull Market

Bull Market

What Does Bull Market Mean?
A financial market of a group of securities in which prices are rising or are expected to rise. The term "bull market" is most often used to refer to the stock market, but can be applied to anything that is traded, such as bonds, currencies and commodities.

Investopedia explains Bull Market
Bull markets are characterized by optimism, investor confidence and expectations that strong results will continue. It's difficult to predict consistently when the trends in the market will change. Part of the difficulty is that psychological effects and speculation may sometimes play a large role in the markets.

The use of "bull" and "bear" to describe markets comes from the way the animals attack their opponents. A bull thrusts its horns up into the air while a bear swipes its paws down. These actions are metaphors for the movement of a market. If the trend is up, it's a bull market. If the trend is down, it's a bear market.

Investing In Foreclosures Not A Get-Rich-Quick Venture

Investing In Foreclosures Not A Get-Rich-Quick Venture

*To invest in real estate it takes a lot. I've have my own story of my real estate experience. Here is some insight to the topic. Make your own conclusion... But remember scared money doesn't make money...

Planning for Retirement Without a 401(k) - US News and World Report

Planning for Retirement Without a 401(k) - US News and World Report
If your in business for yourself or don't believe in your companies 401k here are some additional options...

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The Basics Of Trading A Stock

The Basics Of Trading A Stock

Who Needs Bonds When You Can Have Income Mutual Funds?

Who Needs Bonds When You Can Have Income Mutual Funds?

Top 10 Life Insurance Myths

Top 10 Life Insurance Myths