From the course: Helping Your Employees Meet Retirement Goals

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Need to know: Financial building blocks

Need to know: Financial building blocks

From the course: Helping Your Employees Meet Retirement Goals

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Need to know: Financial building blocks

- When faced with a complicated set of options, a lot of people become paralyzed and aren't able to make a choice. Like when you're stuck at the store staring at a shelf full of different snacks. Fortunately, the cost of not making a snack decision is pretty minor. But when you're talking about finances, the penalty can be severe, and this is especially true of company sponsored retirement plans. If employees don't choose what investment to put their money into, the money they have in their plan will probably just sit there as cash, not growing. So let's review two basic building blocks of investing; stocks and bonds, so you'll be able to answer your employees basic questions and help guide them over their decision making hurdles. Let's start with stocks. When you buy a stock you own a part of that company, and as an owner you can profit from the success of the company because as profit increases, the value of your stock usually goes up, too. Some companies also offer dividends, which…

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