Many people believe investing and saving are the same thing, but they’re definitely not. Though they are often used interchangeably, it’s essential to understand their unique differences and how properly understanding these two words impacts your financial roadmap.
Simply put, saving is putting money into an account where it sits safely; it doesn’t carry much risk, nor does it grow very rapidly. On the other hand, investing is putting money in an account that does bear some risks, but it also seeks to grow and make more money. The differences between the two are vast, and your choices in how you utilize them can result in significant financial differences in the long run.
The explanation given in this Saving vs. Investing: What’s the Difference? article on Investopedia.com helps explain the stark contrast perfectly. Take a few minutes to look it over. It will change how you see them both and should motivate you to start investing (or investing more).
If you have questions, we’re here to get you started on the right foot. Our passion is helping people just like you build a plan targeting their financial needs and goals.