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What is the difference between savings and investments?

Savings refers to the money that is put aside for a specific purpose or future use. It is usually held in a savings account or other low-risk, interest-bearing account. Savings are generally short-term and used for emergencies, small purchases or expenses, or to accumulate enough funds for a larger purchase or investment.

On the other hand, investments refer to the purchase of assets that are intended to increase in value over time, generate income, or both. Investments can range from stocks, bonds, mutual funds, real estate, or other assets that have the potential to provide a return on investment. Investments require a higher degree of risk compared to savings, but they also have the potential for greater returns over the long term.