SAVING VERSUS INVESTING MONEY

SAVING MONEY

Saving money is the process of putting money away for future use. People today put money away in banks, with the banks paying interest on the money, this interest increases the value of the amount of money save this is called, compound interest. Albeit Einstein said” compound interest is the greatest discovery of our time”. Rothchild a billionaire said “compound interest is the eight wonder of the world.

Money saved is defined as safe and secure, there are no losses only profit. Little or no risk, a very easy way to multiply your money. A Danish proverb says “money saved is as good as money gain”. Saving is basically a lazy way of making money.

INVESTING MONEY

Investments, defined by many people with one word “risk”. Risk is not a good word to many people. Investments carry a measure of risk but, compared to saving money, investments have the potential of being more profitable. Banks offer 5%, 10% or 20% interest on a savings account or stock bond. Investments offer returns of 100%, 500% or even 1000% on capital invested only with risk.

Saving and investing money can be compared to, walking and driving. If two people where to travel from Chicago to New York, one by foot the other by a 500 horse power range rover spot jeep (love that car), both will arrive at their destination only, that the person with a 500 horse power car will arrive in a day or two (with the risk of accident) and the guy on foot will arrive in weeks with no risk. (Assuming no risk of being robbed and bad weather)

Investing requires creativity, self-control, high financial education and high financial IQ to succeed, while saving money requires, little or no thinking, little self-control and living below your means.

WHICH IS BETTER

Choosing between investing and saving depends on what you wish to achieve, it depends on your dreams, goals and vision for your future.

Thank you for reading this article.