Having a good habit of saving and investing is vital to financial growth. However, understanding when to prioritize one over the other is key to achieving your financial goals. Let’s take both, one at a time.
What is saving?
Saving entails keeping money for future (short-term) use. Keeping cash is good only in the short term because inflation (rising prices) reduces the value of your money over time.
When should I save?
You can choose to save if you tick the boxes below:
Investing means buying assets with the aim that the value will appreciate over time and earn you a profit greater than your initial investment. Although investing involves risk, having a good investment portfolio of stocks, bonds, real estate, etc. can help protect the value of your money against inflation in the long term
When should I invest?
In summary, choosing whether to prioritize investing or saving depends on your current situation, financial goals, and time horizon. If you have long-term goals and need to start investing now, click here to get professional support.