Personal Finance

When researching retirement and other types of investment accounts, you might see terms like "pre-tax," "tax-deferred," “tax-free” and "tax-exempt" used to describe the tax treatment of certain types of account contributions, earnings and investment products. Understanding these terms can help you make investment decisions based on your personal needs and circumstances.

Here’s an introduction to some commonly used terms:

As you journey with children from ABCs to adulthood, investing for their future can help to build a strong foundation for the years ahead. The earlier you begin, the more time the funds can benefit from the power of compounding, where money earned from investments can generate additional returns over time. 

Have you ever received a text or voice message from someone claiming to be an investment professional and requesting confidential personally identifiable information? Have you seen a video posted on social media featuring a known celebrity promoting a “fantastic” investment opportunity? Has someone who sounds like a family member called with a frantic ask for you to wire them money? Videos and calls like these might look and sound real, but they might actually be scams using deepfakes and vishing, two rapidly evolving cyber threats facing investors today. 

If you’re an avid trader, you might be pursuing—or thinking about pursuing— a strategy involving frequent, intraday trading. Investors who actively trade securities, including stocks or options, throughout the day might attempt to profit from small price movements, typically related to volatile stocks, and often make these trades using margin. However, some active investors might choose to implement a frequent trading strategy in cash accounts as well. 

One consideration when investing is whether to put your available funds to work all at once or over a period of time. If you choose the latter route, you might opt for an investment strategy called dollar-cost averaging.

With dollar-cost averaging, you invest your money in equal portions, at regular intervals, regardless of current market conditions.

Imposter scams can take many forms, and there are new variants every day. In investment-related imposter schemes, a common thread is that scammers misuse the name of real registered investment professionals or firms to create the appearance of legitimacy. Imposter schemes rely on a tactic known as source credibility—building trust by claiming to be properly registered and employed by a well-known firm—and they can be alarmingly convincing.

Below are some of the imposter tactics scammers have used to target investors and tips to protect against imposter scams.

While FINRA will never ask you for money, there are scammers who might try to convince you otherwise. These financial fraudsters pose as regulators, requesting fees to transfer funds or offering bogus investment “guarantees” that are designed to steal your money.

FINRA has adopted significant changes to its margin rule with potential impacts on active investors. If you currently engage in or are considering an active investment strategy, be sure to understand what's changing and how this will affect you. 

Brokerage firm customer account takeover incidents are on the rise, according to FINRA, which has seen a notable increase in this type of fraud. As this threat grows more sophisticated and frequent, understanding how these cybercrimes occur and taking proactive steps to secure your accounts has never been more important.