Page 7 - Martin Down Bulletin - September '24

Martin Downs, Page 7

FinanCial FoCus ®

Know The Risks Of Investing guaranteed, they do carry reinvestment risk — the risk that Edward Jones, its employees, and financial advisors
cannot provide tax advice. You should consult your
you won’t be able to reinvest the proceeds of a maturing
– And Not Investing CD at the same interest rate. To help protect against this qualified tax advisor regarding your situation.
risk, you could own CDs of varying maturities. When Contact us at (561) 748-7600, Sally Sima Stahl, CFP ,
®
™
By Sally Sima Stahl market rates are low, you’ll still have your longer-term AAMS , 1851 W. Indiantown Road, Ste. 106, Jupiter, FL
Inves ting involves CDs paying higher interest, and when market rates rise, 33458.
risk — and so does not you can reinvest the money from your maturing shorter-
investing. You should know term CDs into the new, higher-paying ones.
how both these types of risk Now, let’s turn to a completely different type of Film Review from page 6
can affect your ability to risk — the risk of not investing. And this risk is easy to
reach your financial goals. understand: If you don’t invest, or if you consistently overcome the sadness and feeling of loss of self-
Let’s start with the invest only in the most conservative vehicles, your money worth caused by that decision.
risks associated with may not grow enough to allow you to reach your important That is the turning point in the film, for it led the
investing. There’s not a long-term goals, such as a comfortable retirement. real John Callahan–who is able to use his hands—to
single investment risk Of course, this doesn’t mean you should never own become an accomplished cartoonist whose work
because different types of conservative investments, including CDs and some types you will instantly recognize from newspapers and
investments carry different types of risk. Here’s a look of bonds. When you’re saving for a short-term goal, popular national magazines—and whose humor,
at three investment categories and some of the risks such as a down payment on a house, a wedding or a long while definitely funny and clever, is often considered
connected with them: vacation, you want the money to be there when you need somewhat risqué and even the object of complaints
• Stocks – When you invest in stocks or stock-based it, so an investment that offers protection of principal may from certain social and religious groups.
mutual funds, you will incur the risk that the value of be appropriate, even if it doesn’t provide much in the way Interestingly, although I strongly disagree,
your investments may decline. Stock prices can fall for of growth. because the film shows some of these wonderful
any number of reasons – lower-than-expected earnings, For those long-term goals, though, you may need cartoons, the movie itself is listed in the category of
a change in management, change in consumer tastes, and to build an investment portfolio that contains growth “comedy drama” despite the fact that the story itself
so on. Although the historical trend for stocks has been potential and that reflects your personal risk tolerance is of a life that can hardly be considered as having
positive, there will always be periods when prices are and time horizon. Over time, your risk tolerance may any semblance of humor.
down. One way to help defend against this volatility is change. As you get closer to retirement, you may want But there is indeed a happy ending to this life,
to hold stocks for the long term, rather than constantly to take a somewhat more conservative approach — but one that will reward you for staying with the film
buying and selling, and to own a mix of stocks from you’ll always need some elements of growth. as I urged you to do at the opening of this review. A
different industries and even different countries. When you invest, risk can’t be eliminated, but it can successful career as a cartoonist…a loving marriage
• Bonds – When market interest rates rise, the value be managed. Keeping this in mind, consider a long-term to Annu, caregiver at the hospital who understood
of your bonds can decline because investors won’t pay investment strategy that allows for risk but also offers the what this patient needed at the worst moment of
full price for them when they can get the newer ones that possibility of reward. his life…and, as you will discover, the one-word
offer higher rates. Another type of risk associated with This article was written by Edward Jones for use by lesson learned from his AA leader that enabled John
bonds is credit risk, which essentially describes the risk your local Edward Jones Financial Advisor, Edward Callahan at last to overcome his life of alcoholism.
that the bond issuer may default, potentially disrupting Jones, Member SIPC.
your flow of interest payments. However, you can help Edward Jones is a licensed insurance producer in all states
mitigate this risk by purchasing investment-grade bonds and Washington, D.C., through Edward D. Jones & Co., L.P.,
that receive the highest credit ratings from independent and in California, New Mexico, and Massachusetts through
rating agencies. Edward Jones Insurance Agency of California, L.L.C.;
• Certificates of deposit (CDs) – Although CDs are Edward Jones Insurance Agency of New Mexico, L.L.C.; and
generally considered safe because their principal is Edward Jones Insurance Agency of Massachusetts, L.L.C.