saving v/s investments

Traditionally, saving has always been viewed  different from investing. In saving , the initial amount of capital or cash remains constant, earning in the form of rate of interests

hoever as far as investement is concerned the capital value of investments is not constant and can go up or down. Returns are not guaranteed. but , creation of money market funds and deregulation of the banking industry have resulted in a variety of savings options that earn variable rates of return.

Savings provide funds for emergencies and for making specific purchases in the relatively near future (generally within two years). The primary goal is to store funds and keep them safe. This is why savings are generally placed in interest-bearing accounts that are safe

Saved money plays the role of nsurance. It is an insurance against risk, against losing your job, against having a major unexpected repair bill or medical expense in the family. It is the backbone of you and your family’s financial well-being. Saved money grants you financial security. And the more you save, the more you’ll feel financially  secure   and independent

The goal of investing is generally to increase net worth and work toward long-term goals. Investing involves risk like , r isk of your stocks losing money, or even going bankrupt . Risk of interest rates rising, and bond prices falling. Risks of your broker swindled you, or coerced you though his sales pitch to buy speculative investments. Risks of the economy. Risks of a particular industry. Risk of losing your principal. Risk of losing it all.