Saving money is a great way to prepare for unexpected expenses and investing your money can have the potential for higher growth than saving.
A lot of people put their money in a savings account and leave it there to accumulate interest. While this is a good strategy in the short term, you potentially risk losing out on higher returns in the long run, while also struggling to keep up with inflation. However, investing is a good approach if you have long-term financial goals and want to earn more money than you could by saving it.
What’s the difference between saving and investing?
With saving you are setting aside cash for future use, while investing means using cash to buy assets that you expect to produce a profit or income. The biggest difference between saving and investing is the level of risk. With saving you will always get back at the very least what you have put in, as well as any interest on your deposits. You won’t lose any money, making it a less risky option.
Investing your money means it will rise and fall over time and there is a chance you could lose some of your initial investment. Your financial adviser will be able to help you make sure you’re aware of the risks and the minimum time you should consider investing for. A longer timeframe (at least five years) will give your investment more time to recover if there are any sudden market swings.
Speak to your financial adviser to find out about a range of investment opportunities to help you meet your financial goals. The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.
Yellow Brick Mortgages can help you work out the pros and cons of a remortgage, and what could work best for you.
