April 26, 2007

Hosford Middle School Career Day

Investment 101 Outline

Dow Jones Industrial Average gauges performance of 30 representative widely held public companies.
 May 26, 1896   40.94
April 26, 2007 13,000+

Rule of 72’s
Divide 72 by interest rate = # of years to double
Example: $50,000 becomes $100,000 in 9 years with a compound interest rate of 8%
Example: Ages 14-17 4 summer jobs x $2000 = $8000
Stash $8000 in a Roth IRA for 49 years and do not touch principal
Through the power of compound interest the original amount is now over $1,000,000 at age 66 average stock market return about 10% x 7 years = 7 doubles in 49 years!

Successful Investment Strategies

Acquire appreciable assets.
Spend less than you earn. (Current national savings rate is -.7%. In 1960 it was 7.5%)
Keep spending journal to track expenses.
Discuss spending journal with family and friends. (Fine-tune budget and align with goals.)
Invest in yourself through education.
Pay yourself first consistently.

Dream it, Plan it, Write it, Do it!

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