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Which is difficult – Saving money or Investing money?

Earning enough money to maintain the standard of living is the biggest task in everyone’s life. However, people seem to find it difficult to save or invest money even more than earning that money. Saving and investing money is equally important as earning it. People are also not aware of the difference in saving and investing as well.

Savings is actually a no brainer task and every individual should be able to save money without any issue. However, few things that make it difficult for people to save are irregular saving habit, spending before saving, cashless payment methods and lack of proper goal and planning. People think that by just keeping money in their savings or salary account they could accomplish their savings goal. But what they fail to notice is that there is no fixed margin that differentiates your savings from the money that is available for you to spend in such a scenario and this leads to people digging into their savings without realizing. It is always better to have a separate account to save your money for the specific purpose so that you won’t use that money by mistake. Many people start saving money enthusiastically but fail to stick to a strict regular regime. Unless you make it your habit to regularly and systematically save money, you will not be able to reach your savings goal. You can stick to a regular saving method such as maintaining a recurring deposit account or make it a point to transfer money to your savings account every month as soon as you receive your paycheck. People also face difficulty saving money when they start spending from their monthly salary even before they keep aside an amount for savings. It is a good practice to automate your monthly savings through ECS so that you will not miss out on saving money as soon as your salary gets credited. Another recent issue that people face in saving money is due to the cashless payment methods such as plastic card payments, online payment, and bank transfers. When you use physical money to buy things, you can always see what is left in your wallet when you spend. This will serve as an alert for you to stop making further purchases. However, with cashless payments, people sometimes tend to overdo their purchases.

When it comes to investments, it obviously needs at least a little bit of planning, budgeting and researching before one could even start investing. Though this sounds like too much work and therefore seems to be difficult, in reality, what one can gain with proper investment will outrun those small difficulties. Unlike savings, investing varies with the risk tolerance level. This means that as you get closer to your retirement age, you should refrain from investing in high-risk stocks or bonds and choose safer options. So, this calls for proper planning and an early start to reap good gains through your investments. You should also do your share of research to find out which stocks are doing good, how to distribute your money in different markets (equity, debt etc) and also decide the percentage of money that would go into each segment. You should also keep tracking the performance of your investments regularly and change them if they are not performing well. All these will seem like a lot of work, but there is a lot of help available and you can approach the designated agents for your investments needs if you are not sure how to handle it by yourself. If you choose the right financial advisor/ agent, then investing will not only be a piece of cake but you can also enjoy high returns on your money.

Both savings and investment have their own share of difficulties and for most people savings will seem to be a lot easier and a safer option. But, it is not possible to reach your long term goals and accumulate that required amount of money by just saving it. Only investments can help you in creating wealth that you can enjoy in the future. Savings will be easy, to begin with but you will face difficulty when you near your retirement or after you retire as you will not have the required amount of money. Investing will be difficult in the beginning but you can sure enjoy a peaceful and relaxed retirement with proper investments.


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About the Author: Maithreyi

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