This fifteen minute podcast from Motley Fool (start at 1:00 and finish around 16:00) is a good homework assignment prior to your unit on investing.  The three personal finance experts answer a listener’s question (Ok, it’s really not a question):

When my friends start talking about investing, I just sort of nod my head and pretend to know what they’re talking about. I have been doing this for so long I’m too embarrassed to admit that I don’t know the difference between a stock, a bond, and a mutual fund. Help me sound smart.

As students listen, have them key in on the following questions:

• What is a stock?  What does a shareholder own when they own stock in a company?
• What is a bond?  How does it differ from a stock?  Generally speaking, do bonds tend to be more or less risky then stocks?  How does a bondholder get paid?
• What is a mutual fund?  What is the difference between an actively managed fund and a passive mutual fund?  Which do you think you would prefer and why?  Why do people invest in mutual funds instead of individual stocks?

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.