What are they and how do they work?
The three investment asset types include: (1) Savings Account, (2) Bonds, and (3) Stocks.
A savings account can also be defined as a loan to a bank.
Bonds are also known as "Fixed Income" and is essentially a loan to a company, municipality, or government.
Owning Stocks is owning a piece of a company.
Saving Vehicles are associate with low risk, low return and include saving accounts, checking accounts, money market accounts, and Certificates of Deposits (CDs). Investment vehicles are assoicated with high risk, high return and includes bonds, stocks, mutual funds, real estate, and commodities.
With an average return of .01% on a savings account, it'll take 7200 years to double your money. With an average return of 4% on bonds, it'll take 18 years to double your money. With an average return of 9% in the stock market, it'll take 8 years to double your money.
It's hard to grow your wealth if you don't invest!
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