Saving vs. Investing

Is there really a difference between Saving and Investing?

Most of us think that Saving and Investing are the same thing. While the terms are often used interchangeably by many, they are as different as chalk and cheese.

The difference between your monthly income and your expenses is what constitutes your "savings".

But when you multiply the money you save by putting it in various asset classes such as stocks, bonds, real estate, Mutual funs or gold, you are creating wealth by "investing".

eg.Vijay puts money aside on a regular basis. He spends less than he earns and deposits the rest in the bank. This is Saving. Ajay goes a step further. He puts aside a fixed amount every month in mutual funds. This is Investing.

Money kept in a safety vault though safe does not generate adequate returns to beat inflation.

Money invested in products like stocks, mutual funds, etc. is subject to risk but has the potential to grow over time.

To avoid the risk of make uninformed, wrong and implusive decisions, it is in best interest to have a #financial consultant. Just like we have doctors for illness, lawyers for legals, CA for returns, financial consultants are off prime importance to preserve and grow wealth. Never cut corners here it is too risky in the long run.