Finance Investment Basics: Chapters 1-3

Chapter 1: Making Sense

• Defines ownership investments and categorizes them (three major types).
• Outlines pros and cons of each investment type.
• Discusses strategies for achieving financial independence.
• Covers SMART financial goals.
• Defines lending investments and their types.
• Explains the pros and cons of lending investments.
• Introduces brokers and investment firms.
• Outlines methods for choosing the best brokerage/ investment firm.

Chapter 2: Retirement Accounts

• Compares short-term and long-term financial goals.
• Defines a "rainy-day" fund.
• Explains consumer credit.
• Discusses different retirement accounts and their acronyms.
• Explains tax advantages of retirement accounts.
• Explains disadvantages of retirement accounts.
• Details how to avoid early withdrawal penalties.
• Explains IRA vs. Roth IRA retirement plans.

Chapter 3: Risk & Returns

• Explains the importance of risk and return.
• Outlines methods for reducing investment risk.
• Defines inflation and its impact on purchasing power, providing an example.
• Highlights the importance of liquidity.
• Discusses strategies for minimizing risks related to investment.
• Defines "rate of interest" and "yield."
• Explains the difference between real return and average return.
• Describes how compounding grows investment dollars.

Chapter 4: Minimize Taxes

• Defines tax-sheltered retirement accounts.
• Compares capital gain and ordinary income tax.
• Provides an example of federal marginal income tax rates.
• Explains the advantages of understanding marginal tax rates.
• Discusses knowledge of corporate tax rates.

Chapter 5: Money Mutual Funds

• Explains what money market mutual funds are.
• Details the benefits and drawbacks of money market mutual funds.
• Lists common money fund holdings.
• Describes different methods of accessing funds from mutual funds.
• Provides guidance on how to choose good money market mutual funds.
• Defines municipal bonds.
• Outlines alternative investment options to mutual funds.

###Chapter 6: Stocks

• Defines stocks and provides examples.
• Expands on offering stocks.
• Presents benefits and drawbacks of investing in stocks.
• Introduces Initial Public Offerings (IPOs) and their relation to stock prices per share.
• Explains what happens when a company issues new stock.
• Defines profit and earnings.
• Provides examples of non-profit organizations.
• Describes main ways companies increase profits.
• Discusses methods of earning or making profits from investing in a company's stock.

Chapter 7: Bonds

• Defines bonds and why they are considered as investment options.
• Outlines the benefits and drawbacks of bond investments.
• Expands on the taxation implications of bonds.
• Presents comparisons between bond mutual funds, ETFs, and individual bonds.
• Discusses bond issuers.
• Defines credit rating of bonds.
• Explains bond maturity.
• Explains the yield curve.

Chapter 8: Fund Investing (ETFs)

• Introduces Exchange-Traded Funds (ETFs).
• Discusses methods of investing in ETFs.
• Covers reasons for investing in funds.
• Explains the role of individual fund managers.
• Outlines methods to keep costs down on funds.
• Defines index funds.
• Discusses active versus passive management strategies for funds.
• Explains what mutual index funds are.

Chapter 9: Investment Alternatives

• Defines options and explains their pros and cons.
• Lists types of commodities.
• Explains metal ETFs.
• Defines cryptocurrencies and their pros and cons.
• Explains collectibles and their pros and cons.
• Covers annuities and cash-value life insurance, and provides details about their correlation.
• Defines affiliates.