ands for Individual Retirement Account 3. Basically, what you can do with this type of an account isdeposit a maximum of $2000 every year and you will earn interest on it. The earnings are also tax deferred,which means that you won't be taxed on the earnings until you withdraw it after you're 59 1/2 years old.* 4. This is a long-term investment so you will be penalizedif you take your money out before you are 59 1/2.* B. Stocks 1. 5 people of the 19 surveyed own stock 2. According to Bill Staton of the Staton Institue, Inc.,The annual rate of return of the finest companies areabout 13-15%. This is the rate that these companies have appreciated since World War II. 3. The old belief is that only millionaires invested instock. But now more and more people are investingin stocks because they see the great rate of return. 4. To make things even easier, people can buy and sellstocks by going on the Internet. The commissionrates are relatively cheaper than hiring a real broker.You can also get investing tips from these onlinebrokers. (Transition: These are just some of the things you can do to start saving for your retirement. Just opening an IRA account or investing in stocks is a good start. Or you can do both. Now I will illustrate how saving for retirement is beneficial) III. Visualization Step A. The key here is the earlier you start, the better off you are. 1. Suppose that you made an investment of $1000 per year in stocks and other investments atthe age of 25. 2. And suppose your friend did the same thing but hestarted at age 35. 3. You stop investing after 10 years and your friendcontinues to invest until 30 years. 4. Assume that there is an annual return rate of 8% 5. At age 65, the account value of your investmentwill be $170,030 and only $122,346 for your friend. 6. You'll make $47,684 more than your friend even when he invested the same amount of money 20 more years than you. B. This is called compounding, the more t...
