Saving and Investing for business in TLE 10

1. Savings & Investments

3. • Savings can be simply defined as setting aside a portion of an income,
earnings, or allowance at home or in a bank. It can be used as a reserve
to meet emergencies, as a retirement fund, or a way to realize long-term
goals such as purchasing a new car or a new house and lot.
• Savings is the amount of money left over after spending and other
obligations are deducted from earnings.
Savings

4. 5 BENEFITS OF SAVING MONEY
1. It helps in emergencies
Emergencies are always unexpected. Therefore, when they occur, the
funds required are usually not part of your regular budget. There is
often pressure to look for extra funds at a very short notice such as
funeral expenses, house repairs and even car repairs. Accumulated
savings can often go a long way in alleviating these emergency
situations.

5. 5 BENEFITS OF SAVING MONEY
2. Cushions against sudden job loss
You may have a good job now, but what if you were to lose that
job? Suddenly finding yourself unemployed can be frightening
and traumatic, but it’s something many people will experience at
some point in their lives. Having savings in place to help cover
your living expenses while you find a new job can provide you
with peace of mind.

6. 3. Helps finance those big-ticket items and major life events
Whether you’re looking to buy a house or car, tie the knot or even start
a family, many big life events can often carry a hefty price tag.
For some of these the thought of reaching for a credit card or taking out
a personal loan is all too easy.

7. 3. Helps finance those big-ticket items and major life events
However, using savings to help fund these things is a much better
option than putting yourself in debt and having to repay the funds
borrowed along with interest. Some of these, such as purchasing a
property doesn’t allow for borrowed funds to be used anyway, so the
money required will need to have been saved regardless.

8. 4. Limits debt
Having some amount in savings can help to limit the amount of debt
needed, as they can be used to finance certain expenses instead of using
a credit card or personal loan. This will limit the requirement of further
funds and will also allow you to save the amount that would have been
spent on interest.
Savings also help avoid the need to take out an emergency loans when
urgent situations occur, which often come with a higher interest rate.

9. 5. Helps prepare for retirement
When you start the savings habit, it pays to think about the long-term,
as well as what might be just around the corner. The state pension
itself is unlikely to provide you with enough income to cover all your
costs when you eventually stop work, particularly as the age at which
you’ll be able to claim it is moving gradually further away, so the
earlier you think about retirement planning the better.

10. Remember no matter what stage of life you’re in, one thing will always
remain the same: You’re never too young — or too old — to save
money.

11. Investment

13. Investment
- is the process of making money grow and have a return. It is
putting money where it can earn interest for a period of time.
Money placed in any type of investment has its own level of risk and
return. Generally, the higher the return the higher the risk. For
instance, investing money in time deposits is less risky than
investing it in stock.
- An investment involves putting capital to use today in order to
increase its value over time.

14. Most Common Investment Types
• Stocks
Companies sell shares of stock to the public to raise money for their
operations. Buying stock means you own a piece of the company. If the
company is profitable, your stock will increase in value – and in some cases
you may also be paid a dividend. If the company is unsuccessful, you can
lose money as your stock drops in value. The point at which a company
goes public is called the initial public offering period.

15. Most Common Investment Types
• Bonds
Companies and nations sell bonds to raise money. If you buy a
bond, you’re making a loan to the company or country you bought it
from. You will receive an interest payment over a fixed period of time.
Bonds tend to be less risky than stocks, but the return may be lower.

16. Most Common Investment Types
•Commodities
Commodities include agricultural products, oil, gas and other
energy products and metals – including precious metals such as gold
and silver. Their value fluctuates based on market demand. For
example, if there is a shortage of oil, the price of oil will increase and
your investment will rise in value.

17. Most Common Investment Types
• Real estate
Buying your home or a piece of land can be an investment in real
estate – if you expect the value to increase over time. Risk varies for real
estate investments. You can also buy shares in a real estate investment
trust (REIT) – companies that use real estate to generate income for
shareholders.

18. Most Common Investment Types
• Mutual funds and EFTs
Mutual funds and ETFs let you buy different combinations of
common investments like stocks, bonds, commodities and real estate.
Investing in these funds means that you are investing in hundreds of
different assets. This can diversify your portfolio and mitigate risk of losing
money on your investments.

19. PERFORMANCE TASK # 1
- Skit or Tableau
- SKIT: showing a scenario or short story depicting the importance of
saving and investing.
- TABLEAU: In this activity, students create a still picture, without talking,
to capture the importance of saving and investing (1 portray for saving
money and another 1 for investing money)