1# – MORTGAGE BONDS

The only one of these with pledged assets as a security for the loan is the mortgage bond.

2# – THE GENERAL CREDIT OF THE CORPORATION

There are no assets behind a debenture, merely the credit standing of the corporation.  It is a corporate IOU.

3# – STATE INCOME TAXES

Although municipal bonds are sometimes exempt from state income tax (if issued in the state of residence of the taxpayer), all references to tax exemption refer to their exemption from federal income taxes.

4# – CAPITAL APPRECIATION & HEDGE AGAINST INFLATION

Common stock has market risk.

5# – EQUITY OWNERSHIP IN A CORPORATION

Common stock is ownership in a company.

6# – PREFERRED STOCK

Bonds are loans.  Preferred and Common represent ownership.

7# – VOTING RIGHTS, IT HAS HISTORICALLY BEEN A HEDGE AGAINST INFLATION & DIVIDENDS

Insider trading is prohibited.

8# – CASH, STOCK & STOCK OF ANOTHER COMPANY

Cash dividends are normally declared by corporations, but corporations can also declare stock dividends in additional shares of the issuing corporation, or property dividends..

9# – REMOVAL OF VOTING RIGHTS

Owning common stock subjects one to market risk, the possibility that dividends may be reduced, and the fact that they have the last priority in claims against the assets of the corporation.  The right to vote cannot be taken away.

10# – TRADITIONAL IRA

Traditional IRA contributions are taxed during distributions.

11# – ROTH IRA

Roth IRA monies are taxed before capital contribution.

12# – RETAIL

The only option that is non retirement.

13# – 529

529 represents college investments for kid(s)

14# – MUTUAL FUND

A bond is an interest driven investment.  An individual stock can decline quickly based on rumors, supply and demand, earning and news while a CD is also income driven.

15# – REITSs

REITs are Real Estate Investment Trusts.

16# – MORTGAGE BOND

A person more than likely prefers a roof over their head.