The idea
A stock makes you a part-owner of a company. A bond is different — it's a loan you make to a company or government, and they pay you interest for borrowing it. Bonds grow slower than stocks but bounce around a lot less, so people add more of them as they get older and want steadier money. 📜
Words to know
- Bond
- A loan you make to a company or government that pays you interest, then returns your money later.
- Face value
- The amount a bond pays back to you when it ends (often $1,000).
- Coupon
- The yearly interest a bond pays, like 4% = $40 a year.
- Maturity
- The date a bond ends and you get your original money back.
- Yield
- The actual return on a bond based on the price you paid for it.
- Principal
- The original amount of money you lent or invested.
- BND
- A fund that holds the whole US bond market — a basket of many loans in one ticker.
Try it — no account needed
Your grandma is 70 and asks if she should put all her retirement savings in stocks. What do you say?
In the full lesson
- 1Make the call
Vine has 107 lessons like this one, each written three ways so a 7-year-old and a 17-year-old both get a version that fits.
Practice with real prices
Real market data, pretend money. Learn how investing actually works without risking a cent.
Start free