Imagine that you’ve been given $100,000 to invest in the stock market. You have a choice: either put this money into a savings account that pays 3.5% interest per year or invest it in stocks and bonds. If your bank account balance is higher than $100,000 at the end of the year, then you win! If it’s lower than $100,000 at the end of the year then you lose.
You’re given $100,000.
You’re given $100,000. This is the initial amount of money you have to invest in stocks, as well as your total net worth after every trade. If your net worth goes down, that’s okay–the game will automatically deduct the difference from your account and let you continue playing.
The default setting for this game is 100k, but if it doesn’t seem like enough or too much money for you based on your experience with investing or other games like this one (like Monopoly), feel free to change it up!
You can play the stock market with this money, or put it in a bank account that pays you 3.5% interest per year.
The stock market is risky. In fact, it’s a zero-sum game: for every winner there must be an equal number of losers. If you play the stock market and win, someone else loses; if you lose then someone else wins (and maybe both!).
The best way to save for retirement is through your employer’s 401(k) plan or another type of retirement account like an IRA or Roth IRA because these accounts allow you to grow your money without paying taxes until withdrawal–and even then only on earnings from the investments themselves. This means that if you invest wisely over time, when it comes time for withdrawal those investments will have grown substantially in value due to …