Saving is the term often
used when referring to putting a regular amount of money away
for
short
term goals
such as paying for
a new washing machine, a deposit for a car or a summer holiday.
As these goals are short term, saving often means putting money
in low risk, easy access bank/building society accounts or cash
ISAs. Saving can be an effective way of managing your
money and to provide a safety net for emergency expenses.
Investing is associated more with longer-term goals such as
retirement, paying for a child’s higher education or
planning to change your lifestyle. Investing generally means
buying products such as collective investments, insurance bonds,
ISAs, and individual shares. Many people also see their house
as the biggest investment they will make.
Remember, investing always includes a risk
that you might lose some or all of your money. As investing carries
risks, you should talk to a financial adviser or investment specialist
about what
may be suitable
for you and your circumstances. Often, the fact-finding
process they go through with you helps you to realise what
you actually
want. For example, it examines your attitude to risk
in some detail. Also, it might help you to find out about how
much
money you can afford to put aside for investing or saving.
