Am I That Dumb About Money? Part 5: Investing

Becky Blevins, CFP®, CPWA®, MSFS March 20th, 2023

Check out Part 1 of this series if you want to soften the blow of the title of this series!

When I started this writing journey, my marketing department told me people will not read past 950ish words.

Small tangent – when I was an undergrad, one of the professors in the business program limited all written communication to 1 page. If you handed in an assignment that was two pages, he would literally rip the second page off, hand it back to you, then reduce your grade because the writing was incomplete or didn’t have sources. This was traumatizing, and it’s likely he wouldn’t be able to “get away with that” today (he’s retired, so it doesn’t matter), but it taught me a VERY valuable lesson. People in the business world are BUSY, so you need to be concise in your communication. I’m grateful for that lesson because 950 words is not a lot ya’ll. I digress; there’s ZERO chance I can cover the entire investment world in that few words, so I’m going to stay at a 30,000-foot view.


When you buy a stock, you are buying “shares,” or “equity,” or ownership in a company. Don’t go busting into a boardroom meeting of a stock you just purchased; you don’t own the entire company; you own a small piece of the company. However, owning shares does give you the right to vote in shareholder meetings, receive dividends, and sell your shares to someone else.

The price of stocks fluctuates throughout the trading day due to many factors (news from the company, what’s going on in the US, what’s going on in the world, etc.) Stocks can go up, down, and can potentially become worthless. They are generally more volatile and can be riskier than other types of investments.


When you buy a bond, you are loaning your money to a company (or the government) in exchange for something, usually the repayment of the original “loan” plus interest.

Bond prices are generally inversely correlated with interest rates. When rates go up, the value of the bond goes down. Bonds are rated (there are a few popular rating companies)—the higher the rating, the less risk you take, and the lower the interest rate. If you buy a lower-rated bond, you are taking on more risk and should expect to be paid a higher interest rate.

Stock Market:

A collection of people, markets, or exchanges where you can buy or sell stocks, bonds, and other investment vehicles.

Mutual Funds & Exchange-Traded Funds (ETFs):

Have you heard of mutual funds or exchange-traded funds but have no clue what the heck they are? They are essentially a basket of stocks, bonds, or other types of securities. Instead of owning a stock or bond in one company, these vehicles own many different stocks, bonds, or other securities under one wrapper.

Mutual funds trade once per day after the market closes at 4 p.m. eastern time. Exchange-traded funds (ETFs) trade throughout the day. Both mutual funds and ETFs are considered less risky than individual stocks and bonds because of their built-in diversification due to holding multiple positions.

Let’s talk about fees! Mutual funds generally charge annual fees (expense ratios) and sometimes commissions. ETFs also have expense ratios, but they are often much lower than mutual funds. There are also built-in tax inefficiencies with mutual funds, but I will not go down that rabbit hole.

As I write this, we are officially in a bear market and people are looking for comfort, so it’s important to say this—all the research says you cannot successfully time the market. Sure, you were a genius and got out at the beginning of 2022. Where is the bottom? How do you know when we’re at the bottom? How do you know when to get back in?

Time in the market is much more important than timing the market. If I had the secret to timing the market I would be sitting on an island, sipping on a fruity drink, surrounded by money but alas, I am sitting in my office in Rockville, Maryland, on a gloomy rainy Monday writing this blog post.

Tips and Tricks: If someone offers you something too good to be true, it probably is! Your future is a long game and your investments should be too. Don’t fall for those “if you give me $10k now, I can turn it into $100k tomorrow” scams.

I would start by explaining to your kids exactly what I just explained to you. When you buy a stock, you are buying a part of a company. When you buy a bond, you are lending money to a company. Let them invest in companies they find interesting (Disney, whatever new hot toy brand, etc.).

Let’s face it, your child isn’t going to be able to retire off of an account they put $50 worth of birthday money each year. The true value of opening an investment account for them at an early age is the lessons they will learn through experience, but they have to stay interested… thus the recommendation to let them pick their own investments.

On Part 6 of this series, we will discuss “Credit Health” (exciting stuff) and wrap up this series… which may also make you excited. As always, if you have any questions, please feel free to reach out!

Read More By Becky Blevins, CFP®, CPWA®, MSFS

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information and should not be considered a solicitation for the purchase or sale of any security. Investment advisory services are offered through Concord Wealth Partners, an SEC Registered Investment Advisor.

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