Types of Checks, Other Than Personal Single Survival Mrs. Swope Columbian High School

Types of Checks Travelers’ Checks: safe alternative to using cash or credit while traveling; sold in denominations of 20’s and 100’s. May have to pay a fee for use, checks must be signed in the presence of the issuer and counter signed at the time of making a purchase.

Types of Checks cont. Certified Check: a personal check the bank guarantees to be of sufficient funds. The bank guarantees it will not bounce. Fee for this service. Cashiers Check: a check that is drawn against the bank’s account. The bank officer signs the check, bank is obligated to pay. Fee for this service.

Types of Checks cont. Money Order: a one time use check, purchased for a specific amount, obtained from various stores or businesses (gas station, convenience stores, post office) Wiring money can be done electronically through Western Union, fee for service.

Basic Investment Terms: Investment: a tool used to produce more income from current income. Risk: the chance of losing all or part of the money invested. All investments have a risk factor. Liquidity: how easily the investment can be converted to cash with little or no cost. Dividends: the stockholders profits from the stock.

Types of Investments BONDS: interest earning “IOU” sold by the government or corporation to raise money. Treasury bonds: issued by the federal government. Municipal bonds: issued by the city, county, or state government. Corporate bonds: issued by private companies. Bonds are usually safer than stocks; initial investment is usually around $1,000-$3,000.

Types of Investments STOCKS: purchasing partial ownership in a company (buy shares). Stockholders share in the profits and the losses. Stocks are purchased from a licensed stockbroker, may be traded on-line, fees are attached. Risk: varies according to the company and economic conditions.

The Market Bull Market: the cost of stocks are rising, it is an optimistic market. Bear Market: stock prices are falling by 15% or more.

Types of Investments MUTUAL FUNDS: pooling of money from many small investors into one large fund. A professional money manager invests the money into many different stocks, bonds, and other investments. Risk: less risk because money is invested in many different investments

Types of Investments REAL ESTATE: includes vacant land, farmland, and any structure built upon it. Includes: houses, condominiums, commercial, and industrial buildings. The value of real estate is affect by the economy and surrounding properties . When ready to cash in on the investment, must find a buyer, may take months or years.

Summary There are many forms of investments to choose from. Research a variety of investments before purchasing. Know the risks. Don’t invest any money you cannot afford to lose. Have financial goals in mind and match your investments to your financial goals.