investing in your future
Saving vs. Investing
People often use the terms “saving” and “investing” interchangeably, but are they really the same? The simple answer is “no.” What’s the most important difference between when you save and when you invest?
- Savings products don’t offer as many features as investment products do.
- Investing involves more risk than saving.
- Only financially sophisticated people can invest.
“B” is correct. Savings products are generally safer than investments, because they are federally insured and have set program features that guarantee their rate of return. When you invest, there is no such assurance. It’s possible to lose ALL your money -- not just your return, but the total amount you paid as an initial investment. But with this risk comes a chance for greater reward. Shrewd investments held for the right amount of time make it possible to accrue more money than you’ll accumulate by simply saving.