Fun fact: money loses value over time. Okay, so that's not exactly a fun fact,
but if you want to be as financially successful as possible, you've got to understand that. You
can't just take all your extra money and keep it in your pocket because it's not going to
be worth as much in the future, and that's not just because it'll get ruined when you forget
it in your pocket on laundry day. It's actually more accurate to say that money just sitting in
your pocket is losing potential value over time, because you could be putting it somewhere where
it would gain interest and grow in value, instead of just staying the same amount.
This is related to a concept known as the time value of money or TVM. TVM states that any
amount of money is worth more now than it will be later, but only because you could be investing it
now and having it grow in value, instead of just letting it stay the same. Making your money grow
while you're not actively using it is most often done through saving and investing. Interest from
savings and dividends from investments both give you the same result. Your money will grow instead
of losing potential value. So in this video you are going to get a preview of some of the topics
we're going to cover in your upcoming unit on savings and Investments. Let's get into it.
The goal of this unit is to prepare you to become financially independent later on in
your life. Financial independence is when you have enough passive income coming in where you can live
comfortably without needing to continue working for a living. Most people only reach financial
independence when they retire. But a lot of people out there are not okay with this plan. Working
super hard for 50 years and then being financially independent for maybe 10 or 15 more. That doesn't
sound like a great deal. So many plan to become financially independent earlier in life and have
more time to just relax and hang out with friends. Some people choose to live ultra minimalistic
lifestyles by cutting out all the wants from their budget. No going out for fast food, no
random shopping trips, just taking all that extra money and putting it right into their savings.
It's really hard to only buy the things you need. I don't even think I could do it. But that's okay,
because there's a huge spectrum between saving all your money for the future and spend it all now,
spend it all now, and you can choose where your personal lifestyle will fit on that spectrum. In
this unit you're going to learn a bunch of tips and tricks that will help you decide how to best
save and invest your money so that you can become financially independent. First we're going to
learn about all the different methods for saving your money, including the pros and cons of each.
Next we'll go into all the different ways you can invest your money. Investing is usually a
bit riskier than saving, but it can also be a lot more efficient in growing your money.
There are actually so many different ways you can invest your money, that we needed to split
up this topic into two different lessons. Now, knowing all the different ways you can save and
invest your money is great and all, but it doesn't really help if you don't know which
is best. So after this we're going to take a deep dive into the concept of TVM, so that we can find
out ways to compare between different savings and investment options so that you could decide which
is best. And finally, at the end of the unit you will be able to put your newfound knowledge to the
test in the totally possible chance that you win a ton of money on a game show. What would you do?
Would you put it into a savings account? Invest it in stocks? Or just spend it all in a new car?
The choice is up to you in our choose your own story, sudden windfall. By the end of the unit,
you're going to have the knowledge and the fictional experience to be able to make the
decisions that will help you grow your money and achieve financial independence. See you next time.