"Get the Facts: The SEC's Roadmap to Saving and Investing"Introduction
In this activity, students will read about saving and investing for retirement. Students will learn about diversification and explore their own reasons to save. Lesson Description
Students will use information from the SEC's Roadmap to Saving and Investing to think about their plans for saving. They can browse the site for information. Students will answer five questions. Then they think about something they would like to save for and write a paragraph about how they can achieve that saving goals. Previous Knowledge Expected
mutual fund: a type of investment that includes many stocks of individual corporations Applied Content Standards (from the Council for
Economic Education) Standard 10: Institutions evolve in market economies
to help individuals and groups accomplish their goals. Banks,
labor unions, corporations, legal systems, and not-for-profit
organizations are examples of important institutions. A different
kind of institution, clearly defined and well-enforced property
rights, is essential to a market economy. Instructional Objectives- Students will understand that saving and investing are important financial skills.
- Students will gain an understanding of the importance of diversification.
- Students will think about a personal savings goal and identify ways to achieve their goal.
Student Web Activity Answers- Savings typically are put in the safest places or products, such as savings accounts or certificates of deposit. Investments, however, usually involve greater risk, and the investor has a greater chance of losing money.
- Diversification means investing in a variety of products, so that the risk of everything decreasing in value at the same time is lower. Some investments may increase in value, and some may decrease, but overall the risk of everything decreasing is less.
- Answers may vary, but a typical example is the Standard & Poor's 500.
- An actively managed fund employs managers who pick and choose stocks to buy and sell in the mutual fund. Actively managed funds typically have higher fees than do index funds, or funds that are passively managed and simply indexed to a major index such as the Standard & Poor's 500 index.
- Savings plans and goals will vary.
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