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Financial Literacy Club

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Investing · Lesson 1

What Investing Is

Part A. Vocabulary

Define each term in your own words.

Return

Part B. Guided notes

Fill in each blank using the word bank.

Word bank: Custodial · guaranteed · Investing · several

  1. Saving = safe and slow. = more growth potential, more risk.
  2. Only invest money you won't need for years.
  3. Returns are never .
  4. Under 18? accounts are opened by a parent or guardian.

Part C. Check your understanding

Circle the best answer.

  1. You'll need $1,500 for a laptop in 6 months.

    1. Where does that money most sensibly belong?

    • A. Invested in stocks, so it can grow faster
    • B. A savings account
    • C. Split between three trending stocks
    • D. In a friend's new business

  2. 2. Investing can lose money, even when you pick well-known investments.

    True/False

  3. 3. What's the core tradeoff between saving and investing?

    • A. Saving is always better.
    • B. Investing is guaranteed to earn more.
    • C. Investing offers the chance of higher long-term growth in exchange for more risk.
    • D. There's no difference.

Part D. Apply it

Show your work.

  1. 1. Is a savings account or a stock index fund a better home for money you need in six months? Why?

  2. 2. Using the compound growth calculator at a hypothetical 7% a year, what does a one-time $2,000 become after 20 years with no additions?

Part E. Think about it

Answer in complete sentences.

  1. 1. Why do you think many people never start investing?

  2. 2. What's one goal in your life that's short-term, and one that's long-term?

Exit ticket

Name

Give one reason investing can grow money more than saving, and one risk.