Is investing just for the gamers’ grass? And does saving sound like the old people’s mess? The Good Finance family wondered whether either way alone was more profitable, or whether it was actually worthwhile to support each other as mutually supportive measures.
Both have their sides and it is always worthwhile first to find out how saving is profitable and where to invest profitably. It’s not a good idea to start dealing with either, because in the worst case it can lead to financial losses.
Savings – Funds and Accounts
Saving in a fund is more profitable than saving in a zero interest account. Interest rates have been close to zero for a long time, so saving on a basic savings account is currently not very profitable. Of course, putting money aside is always better than saving euros in wasted money.
Saving funds is easy in the sense that you can start by saving a small lump sum or saving a certain amount each month. Starting with a small amount of money makes sense in itself, because saving in this way requires a little patience and learning.
The funds invest the sums by spreading them over the fixed income and equity markets so that they yield in the long term. By diversifying savings across multiple sites, the risks remain reasonably small and the ethical saver can select the sites according to their own values. It is a good idea to check that fund savings still allow you to mobilize funds if you need them.
It is a good idea to start with fund savings, choose your items well and diversify. Many beginner fund savers may be overly enthusiastic about funds and trade very actively. This does not necessarily lead to savings, but to higher costs.
Maintaining a savings account is ideal for accumulating small and targeted savings. A savings account works well, for example, for a single vacation traveler. In that case, it is not so much the long-term return that matters, but the fact that a certain amount is collected by a certain date.
Saving in your everyday life can be slow and systematic, so saving is best done as a marathon rather than as a fast track.
Investing – Shares and Homes
Investing, and especially investing in equities, always involves risk and without risk there is no return. It’s a good idea to be aware of it before you start investing trees. It is also good to know that investing does not usually bring instant profits, but is a function of a long-term plan.
Depending on where the money is invested in, equity investing can be very lucrative. Good luck rarely gives you access to good returns, but you have to read some of the fluctuations and developments in the courses. When you know how to make the move at the right time, you can make a really comfortable living. But first you should think about why to invest and where to invest your money.
Investing in a home can be either a home sale or renting a home, which is better suited to your wallet and your goals. The best deals can be done by buying a basic home for a little money, renovating it and selling at a much higher price. The prerequisite for income is, of course, being able to do the renovation on its own and not having to pay for the work to outside agents.
Investing in a home also requires some equity in the beginning, as few have enough stock to buy a home just without borrowing money. Once you get started, investing in housing is easier because the pot at the bottom is growing and you can invest in more apartments at once.
Saving and investing go hand in hand
There is no one right solution in the Saving vs. Investing layout. They support each other, and starting one will easily end up with the other.
Saving before you start investing allows you to spread the risk across multiple investments. And even investing in a home requires a small nest egg to save.
When the investment is successful, you save money, unless of course you reinvest everything that comes off. Playing cards properly can do both hobbies merit, and investing or saving is never a wasted task. Cleverly done.