Saving vs. Investing: A Guide

We know that saving money is like climbing a mountain, and investing is doing it in flip flops! It sounds hard and scary to think about, but let’s face it, now’s the time to weigh your options and choose a path! We're not 13 anymore, even if it feels like we are sometimes... But trust me, we’ve levelled up to adulting! :(

That being said, let’s get into saving vs, investing in more detail, and in a way that we can all relate to. So to begin with, let’s assume you’re getting into a relationship with one of them! Who would you choose to date? 

Seeing as how saving is all about setting aside easily accessible money for short-term goals or purchases (such as a new wardrobe or a new laptop, for example), saving would be the fun, spontaneous type—always down for a quick getaway, indulging in life’s little pleasures, and not taking things way too seriously. 

Investment, on the other hand, which is all about allocating money into assets or ventures with potential for growth in mind, would be the focused, hard-working type, ready for a serious, long-term commitment—think family, white picket fence, and the whole package.

Let’s say you’re interested in both and you can’t quite make your mind up about either of them… let’s point out the main differences and see where we stand. 

As is the case with most people and relationships, what you choose wholly depends on where you personally are in life right now - it’s kind of the same when looking at it from a financial perspective. 

In the end, it’s all about your current goals.

• The ‘Getting to Know You’ Stage: Time

  When it comes to getting to know someone, everyone moves at their own pace. Some people, like saving,  are easily accessible, quick to make plans, reply instantly, and love hanging out. 

  

  Others like investment, take their time, plan around busy schedules, and move slower.
  
  That’s not to say one is better than the other; the fast vs. slow paced nature of each of these people (or financial concepts) has its pros and cons - at the end of the day, it all comes down to where you stand.
  
  Do you want a fun trip soon, or would you prefer taking your time and focusing on yourself in the meanwhile, while you try to envision your future with them?

• The Red Flags: Risk

  While saving is fun and spontaneous, it might not necessarily be hubby/wifey material. Sure you might have a good time and learn a lot from the experience, but the relationship might not necessarily have room for growth. You see, saving provides lower returns, often in the form of interest, which may barely outpace inflation.
  
  You can save an X amount of money for a new phone, then wake up to find the price doubled!  

  

  On the other hand, investment seems more like marriage material, but marriage is a big deal, and you gotta be as sure as you possibly can about a commitment this big.  Life happens—like a job opportunity far away—which could shake things up.
  ‍
  Also, with investment, your funds are allocated to stocks, bonds, mutual funds, or other assets that can fluctuate in value. Just like in relationships, there are some risks to consider!

  Again, it’s up to you to decide what you’re looking for right now - near-term gratification or long-term investments with room for growth but potential risk?

  

• 3. The Green Flags: ROI

  ‍Saving means having your money be easily and instantly accessible, which can be a huge green flag, and if it’s instant gratification (or validation - no judgement) that you’re looking for, then look no further.

  While investment offers more of a low and slow kind of relationship, in the long run, this relationship can grow significantly over time and end up being one of the most ‘worth it’ experiences of your life.  

  So as you can probably tell by now, choosing between saving money vs. investing money can be a little more complicated than it seems. We believe you gotta measure it out to where you’re at in life at the moment. 

  

  We also believe you gotta experience both, at different times in your life. What to choose right now? Well, that’s up to you - but rest assured, we’ll help guide you through it! 
  Also, with investment, your funds are allocated to stocks, bonds, mutual funds, or other assets that can fluctuate in value. Just like in relationships, there are some risks to consider!

Stay tuned for our series ‘Saving vs. Investing’ as we dive deeper into the pros, cons, and everything in between! 

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