Join Jane Barratt for an in-depth discussion in this video Bonds, part of Personal Investing Basics.
- How would you feel if I told you…the only way you can buy a house…was that if you paid for it entirely in cash.…It's hard to imagine, right?…And that's why loans exist.…Loans make big, important purchases possible.…This is essentially what a bond is;…A loan that you make to a company or government,…so they can finance large projects.…In order to do this, they issue bonds.…Government-Issued Bonds,…which are also called Government Notes or Bills.…are considered quite safe.…Cities, States and federal governments all issue bonds.…
With rare exceptions,…governments always pay back their bonds.…When a government fails to pay it's bond,…which is called a sovereign default,…it's impact to world markets is quite severe,…so it is avoided at all costs.…Some government bonds are also tax-free,…so if you fall into a higher tax bracket,…a tax-free bond can be used as a way to earn income…without having to pay tax on the interest.…Corporations also issue bonds.…Many large, international companies…issue bonds as a way to fund expansion,…
Jane is the founder of GoldBean, an online investing platform that helps first-time and experienced investors alike take their investments into their own hands. In this course, she shares her investment strategies with you. She breaks down the market into its five basic building blocks—cash and equivalents, stocks, bonds, funds, and insurance products—and the different vehicles where you can invest these building blocks. She also covers topics such as the importance of a balanced portfolio, understanding and managing your risk, identifying value in the market, and building your "money muscles" over time. Plus, learn how to calculate the rate of return of a portfolio vs. general market performance. Last, Jane outlines the options for DIY investing, when it makes sense to work with an advisor, and how to avoid costly investment fees.
- Why should you invest?
- Understanding compound interest
- Comparing stocks, bonds, and funds
- Managing risk
- Building a portfolio
- Finding where to invest money
- Working with a financial advisor