And the original bond price and final interest payment is paid at the date of maturity. Bonds aren't as glamorous as stocks, but they're low-risk and a good way to diversify your portfolio. Mutual Funds Mutual funds are a grouping of stocks or bonds that are managed by professional investors. An investment company buys a large quantity of securities and sells portions of the portfolio to the general public. The selling price reflects the value of the total grouped securities.
Funds vary depending on how many stocks are involved.
The benefit of mutual funds is that your investment is spread out over numerous stocks, so if one of them takes a tumble, the fund won't suffer. You place money into an annuity and it's allowed to grow, tax-deferred, until you're 59. After you reach 59 you are allowed to remove money by either receiving steady payments over a period of time, or at once in a lump sum. A cool aspect of annuities is there's no limit to the amount of money you can put in, unlike an IRA or 401K plan. Also, if you happen to die and your account has gone below what you initially invested, the insurance company makes up the difference for your beneficiary.