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Bonds

Bonds are a type of investment that essentially create an I.O.U agreement between the investor and company. In the same manner as individuals do, businesses are in need of funds to complete certain tasks. However, it is not always most feasible to simply borrow from a traditional bank. Instead, by means of a bond, companies borrow money from investors. When an investor enters into this agreement, they receive a written contact of what they are owed, called a bond. The investor takes on a role on the opposite of what they are probably used to, becoming a lender of sorts instead of the borrower. Similar to how a traditional lender would, the investor of a bond is given privileges in exchange for the loan they provide. After a specified period of time has elapsed, the company or issuer of the bond must pay the investor interest on the bond in addition to the principal.

Fast Facts

  • Governments also use bonds to pay for certain projects

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Results 1-5 of 20 for "bonds"

  • Series I vs Series EE

    It can be confusing when trying to decipher the difference between Series EE savings bonds and their Series I ...
    • Site: financialplannernetwork.com

  • Series Savings Bond Types: Advantages and Disadvantages

      Savings bonds have been a staple in American living for decades. These may be one of the safest investments ...
    • Site: financialplannernetwork.com

  • What Is a Bond?

    A bond is a debt instrument--basically an IOU--where an investor is loaning money to the US government, a stat...
    • Site: financialplannernetwork.com

  • College Savings Bond

    College savings bonds are tax-exempt, zero-coupon bonds issued by a state to help families of that state save ...
    • Site: financialplannernetwork.com

  • EE Series Bond College Savings

    Series EE savings bonds are one of the safest savings products available. The series EE bond yield is currentl...
    • Site: financialplannernetwork.com
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