What we say: Bonds are a type of investment. They’re different from stocks because instead of buying an “ownership” in the company, you’re loaning money to them instead. The company then borrows the “bond” money at a fixed interest rate and pays you back over a set period of time.
What Rick Ross says (in his song, 911):
“Boochie Boochie money long, he got 20 cars
Graduated from them cars, now it’s stocks and bonds.”
What we can learn from Rick Ross:
How you can use bonds in your own life to create wealth:
In creating a diversified portfolio it makes sense to have different types of investments– bonds included. Bonds are often regarding as a safer investment since they are offered at a fixed interest rate and loan term. If a company goes bust, bondholders get paid before shareholders.
The Financial Lessons:
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