Visit Before You Invest over the following 12 weeks for our summer Investments at Glance guide. With the help of the Canadian Securities Administrators, we have written this series to tell you about different kinds of investments and some things to keep in mind when you’re considering an investment. The aim is to help investors learn more about their investment options.
We will look at investment classes, including cash, fixed income, equities and alternative investments, and take a closer look at some of the more common types of investments you might encounter.
Before you invest, make sure you understand how an investment works, including any fees, and whether it fits with your goals and risk tolerance. With investing, the higher the potential return, the higher the risk. There’s no such thing as a high return, risk-free investment. If you want higher returns, you have to be prepared to accept the risks that go along with them.
Income tax is another important consideration. Interest, dividends and capital gains are all treated differently for tax purposes and that will affect your return from an investment. A registered adviser can help you assess your financial needs, goals and tax situation. An adviser can also help you build a portfolio and recommend suitable investments for you.
Whether you have an adviser or invest on your own, don’t invest in anything that you don’t fully understand. Take your time when making investment decisions and never sign documents you have not read carefully.
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Investments at a Glance
Today is “Teach Children to Save Day” in the United States. For 14 years the “Teach Children to Save” program, sponsored by the American Bankers Association’s Education Fund, has partnered banks with students for lessons on the importance of saving. The goal is to reach 5 million students before the 15th anniversary of the program, next year.
Canada may not have an equivalent “Day” designated, but we do have very impressive programs to help you teach your children or students the importance of money management, including my favourite: Make it Count.
Make it Count is an interactive money mentoring program and information resource from the Canadian Securities Administrators (CSA). The Make it Count program includes a parent’s guide, an instructor’s guide and an online daily budgeting program that uses everyday situations like errands to engage youth in discussions about money management. Make it Count makes talking with youth about budgeting, debit card use and common sense spending simpler and more effective for parents and teachers.
The program centers around a series of activities, tips and lesson plans that are simple to follow and more importantly, simple to teach. One of the most exciting new elements of the program is an online, interactive money management tool that allows mentors and youth to set up a daily budget, start and track savings goals and chat with other money mentors in an online forum. Users can see where their money is going, track their financial progress and provide their own insights and activity ideas to the online community.
According to a recent national survey, there is a need for financial skills educational resources that are family-friendly. The CSA Investor Index 2009 survey found that 78 percent of Canadians believe that teaching financial skills is among the most important things a parent can do for their child. And less than half of parents with children 18 or younger have actually taught their children about personal finances and investing.
The Make it Count resources, including the interactive online budgeting program can be accessed at MakeitCountOnline.ca. All resources are free and available in both English and French.
Do you like the piggy bank pictured above? Find out more about the Money Savvy Pig from Money Savvy Generation.
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education,
Investor Index,
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Statistics,
youth
