Why we should prioritize investment over saving

[bbigtart]

Another thing: Financial literacy is required. Make educated decisions, not just options. Making investments without knowing market dynamics, risk assessment, and financial planning is like walking a tightrope blindfolded. You think you're progressing but aren't. Before you preach personal choice and common sense, do you understand the economics? Are you repeating platitudes? Be smart, think critically, and you might succeed in this difficult economy

To succeed in a difficult economy is not easy because it always requires precise and intelligent thinking so that you can face all the existing dynamics. Whether it's market dynamics as you said, or other dynamics that exist in life because nowadays almost all jobs that involve money definitely require proper literacy and accompanied by smart thinking.

So true. Whatever our job, we must have the ability to manage finances. Starting from office workers, business people to freelancers, they must have the ability to manage finances, so that finances remain stable and do not disappear in the midst of an uncertain economy. Saving and investing are things that everyone must have to create financial freedom in the future.

To achieve all that, Financial Literacy is very important for everyone to have, this is also so that we are not easily deceived in financial matters such as investment fraud or various other financial related frauds.

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[avp2306]

Why we should patronize investment over savings is that investmet provides more profit than savings. Let's take for example you save money in bank for 3 years, instead of making profit your money would be gradually deducted bit by bit for maintenance,  transfer or SMS fee. But in investment like Bitcoin, volatility in Bitcoin will make it to increase, except the volatility is a negative volatile instead of positive volatility.

Savings are necessary, there can be emergencies and times when you might need funds and you can't use funds that you have invested in such situations. Will you sell your Bitcoins even if they are at a loss if you face an emergency because you don't have funds for the emergency? You can't because that means you are wasting your money and instead of getting profit from your investment, you are getting loss and no one would want that.

So it's essential to have savings, you don't need to keep it in an account where you will be charged fees and stuff, create a savings account and keep your savings in it so that you can use them whenever you need to. If you can afford, have both, savings and investment funds, so that you don't need to use your savings for investment purposes.

Somehow we should think about saving for the time of emergency so that we have to get something when we immediately needed some funds. We can't be so sure when an emergency situation happen so its better to separate some funds for security. Although its really good to invest but the problem there if we can't take out our money when the time we need it the most. For sure we will be in a lot of trouble and for sure to get a lot of stress since we think about we have money but we already put it on some things that we think that can generate us a profit in future but we can't take it anytime we want.

That's why having these two option is really the best so that we can be so sure that we are totally fine and there's nothing to worry about especially when we need something. Some other people may say that emergency cases is rare situation but we should prepare to any possibilities that it will came.

[blckhawk]

Easy answer, saving isn't giving you profit, it only gives you the same amount that you can pull out whenever you need it in the future and saving is vulnerable to inflation especially if it's the piggybank kind of savings meanwhile with investing although you're risking the money because it grows or regress depending on the value of the investment but the point of investment is that the savings is growing and giving you a profit so totally agree with prioritizing investment over saving but the only advantage of saving in this comparison is that, you can pull out savings anytime as for investment, either you pull it out prematurely resulting in small profit or loss because you happen to pull out the investment at the time when the value of the investment was tanking or lower than your initial entry to that investment.

[radjie]

That's why having these two option is really the best so that we can be so sure that we are totally fine and there's nothing to worry about especially when we need something. Some other people may say that emergency cases is rare situation but we should prepare to any possibilities that it will came.

Having funds for emergency needs should be everyone's priority, even if it rarely happens, at least have preparations to deal with such situations.  Choosing savings and investments is of course very profitable if the finances we have are sufficient to cover everything, the most important thing is that meeting basic needs must be prioritized, the rest can be saved and invested even if the nominal value is not too large.  The most important thing is to consistently set aside every month.

[MissNonFall9]

Some savings are necessary in life as these savings will be some recourse in your old age. But of course, investment should be given priority over savings. According to me, investment should be prioritized for four reasons.
 The number one reason is investment will yield a high rate of return which is never possible from savings.
The second reason is if the money is saved and later on if there is inflation, then the profit from the investment will face a loss.
Number three saving is stable and investment is dynamic. We know that status is death and speed is life.
The fourth and final reason is the opportunity cost of savings is high.

[Troytech]

Saving our hard earned money have never been a bad idea, but their are certain things we need to consider before thinking of saving, such as inflation.
Inflation is truly the real enemy to every money that is being saved up, because when the time is right like a year time, when it should be used for it purpose, the value wouldn't be as how it actually was when you started saving it, but on the other hand, if we have been investing that money into Bitcoin, land or gold bit by bit, over the course of a year, the value of that your investment would have added additional value compared to our savings that will be eaten up by inflation.
So too me we should think of investing more of our money than saving it, so that  inflation wouldn't eat it up.

It's true that inflation is a major enemy to savings but its good to always have cash at hand and i think they is a big misconception here, we invest for long term or to make profits and we save to store value or to keep value around in other to solve a problem later.

Now we have to understand that every currency in the world is suvering from inflation right now and some currencies faster than others, dollars is one of the currency with the slowest inflation rate now.

You know the concept of having emergency funds around and reserves as a necessity to ensure that sudden happenings doesn't make you sell you holdings or liquidate your investment, so if you have all your value stored in bitcoin or any investment how would you invest further and what If its serious like a health challenge.

Inflation should not stop you from saving, cause what you save can save you, we save for things like emergency and without saving we are not even sure of holding our investment untill we make profits. So to ensure inflation doesn't meet you find a currency with a slower inflation rate to store your funds in and keep it.

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It's true that inflation is a major enemy to savings but its good to always have cash at hand and i think they is a big misconception here, we invest for long term or to make profits and we save to store value or to keep value around in other to solve a problem later.

I think I've covered saving to solve problems, not every body keeps value for the same reasons, some just want value around, if you want to save to store value while it's not a very good idea cause you could actually invest that money and gain value from it unless for fear of risk of lose in investment.

You can store value in less volatile assets like gold, or stable coins, I guess it's almost alike with the one I explained earlier, except its still involve storing value in assets.

[erep]

Having funds for emergency needs should be everyone's priority, even if it rarely happens, at least have preparations to deal with such situations.  Choosing savings and investments is of course very profitable if the finances we have are sufficient to cover everything, the most important thing is that meeting basic needs must be prioritized, the rest can be saved and invested even if the nominal value is not too large.  The most important thing is to consistently set aside every month.

The need for emergency funds is a prioritized aspect of fund management needs, everyone has savings funds to be used partly for emergency funds and partly converted savings funds for investing in gold, real estate or even bitcoin because even though savings funds also need to be converted into stable investments rather than saving fiat which can lead to inflation at any time, so it would be beneficial to keep savings funds in stable assets for future needs.

[batang_bitcoin]

Some savings are necessary in life as these savings will be some recourse in your old age. But of course, investment should be given priority over savings. According to me, investment should be prioritized for four reasons.

For the older ones, savings are a must because they can't take any longer risk unless they've got a huge savings that they can attain to lose money by taking risks with investments. It's best for the younger ones to invest at an early stage because they can attain to make mistakes and they can recover eventually, that's why the old ones are good to have with what's left on them if they ever have saved and invested at their young age. And as they grow old, it's best to them to just enjoy the profits they've made to enjoy life.

[Dr.Osh]

Easy answer, saving isn't giving you profit, it only gives you the same amount that you can pull out whenever you need it in the future and saving is vulnerable to inflation especially if it's the piggybank kind of savings meanwhile with investing although you're risking the money because it grows or regress depending on the value of the investment but the point of investment is that the savings is growing and giving you a profit so totally agree with prioritizing investment over saving but the only advantage of saving in this comparison is that, you can pull out savings anytime as for investment, either you pull it out prematurely resulting in small profit or loss because you happen to pull out the investment at the time when the value of the investment was tanking or lower than your initial entry to that investment.

Apart from that, saving always has problems with inflation. So, the value of your savings could decrease without reducing the amount. However, with investment, we can generate additional income at any time.
However, I also think that it would be better to prioritize investments because they can be a very good thing when we have entered old age, or perhaps retired. The investments we make today can be a new source of income, and in fact, in many cases, people who focus on investments have much more income from investments than from their main job. However, investing is a very good thing, but we also need to save because we don't want to sell the investments we have when we need money in an emergency. at that time, savings are very necessary.

[GideonGono]

Saving our hard earned money have never been a bad idea, but their are certain things we need to consider before thinking of saving, such as inflation.
Inflation is truly the real enemy to every money that is being saved up, because when the time is right like a year time, when it should be used for it purpose, the value wouldn't be as how it actually was when you started saving it, but on the other hand, if we have been investing that money into Bitcoin, land or gold bit by bit, over the course of a year, the value of that your investment would have added additional value compared to our savings that will be eaten up by inflation.
So too me we should think of investing more of our money than saving it, so that  inflation wouldn't eat it up.

There is a huge difference between investment and saving as you said, saving would only make the value of our money be smaller or the things that we could buy with it would be less in the future due to inflation.
The problem in investment is not everyone is cut out for it, they would just focus on the profit not considering the risk.
One of the biggest example that we could give is those who invested in crypto without proper knowledge, and those who would cry every time that the price drop down.
When investing your money you should always consider the risk not just the profit, most of the investor of crypto focus on the successful stories not knowing the road that they take to be successful isn't easy as we think.

[Pi-network314159]

For now inflation is eating up fiat all over the world now, the option is to either invest in Bitcoin or any other asset that will reduce your level of lost to inflation. Investment is the best option now. Any money you keep on bank does not only reduce in value but it is also not working out money for you. The most important thing to make you succeed is to invest. The moment we always think about investment the more we understand and have the thinking of a rich person because investment is the key to richness or success.

[ajiz138]

Some savings are necessary in life as these savings will be some recourse in your old age. But of course, investment should be given priority over savings. According to me, investment should be prioritized for four reasons.

For the older ones, savings are a must because they can't take any longer risk unless they've got a huge savings that they can attain to lose money by taking risks with investments. It's best for the younger ones to invest at an early stage because they can attain to make mistakes and they can recover eventually, that's why the old ones are good to have with what's left on them if they ever have saved and invested at their young age. And as they grow old, it's best to them to just enjoy the profits they've made to enjoy life.

Enjoying life is one of the goals when we are required to invest, by investing we can expect something better, especialy in financial terms. But for me saving and investing are both equally good and if possible it's better to do both. We can use our savings when something sudden happens that requires us to spend more money, so our investment will not be disturbed because we still have savings.

We can also use savings for investment, for example when we have a lot of savings we can allocate it to investment. I think that is a good way to do it, because it has many advantages that we can utilize.

[blckhawk]

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Apart from that, saving always has problems with inflation. So, the value of your savings could decrease without reducing the amount. However, with investment, we can generate additional income at any time.
However, I also think that it would be better to prioritize investments because they can be a very good thing when we have entered old age, or perhaps retired. The investments we make today can be a new source of income, and in fact, in many cases, people who focus on investments have much more income from investments than from their main job. However, investing is a very good thing, but we also need to save because we don't want to sell the investments we have when we need money in an emergency. at that time, savings are very necessary.

Exactly, that's another reason why savings alone won't be a big deal in the long run, inflation will definitely destroy that savings in no time and when you know that you've got 1k USD in savings but then you will be surprised that next month, it's probably valued or worth 998.9 USD, that's how vicious inflation is, that's why when I asked a friend that's been working as a financial advisor, they'll almost always say that it's a good idea to be investing instead of saving alone. Another thing to consider about investing is that you're going to need to balance a life worth living and investing because if you're just investing your money alone and you're forgetting to have fun, the cycle of monotony and despair will be on you and you're not going to reach the age of retirement if you're only focusing on those investments and not having fun, don't put all the money in investments, try to get a vacation at least 2 times a year and get a hobby.

[fuguebtc]

Easy answer, saving isn't giving you profit, it only gives you the same amount that you can pull out whenever you need it in the future and saving is vulnerable to inflation especially if it's the piggybank kind of savings meanwhile with investing although you're risking the money because it grows or regress depending on the value of the investment but the point of investment is that the savings is growing and giving you a profit so totally agree with prioritizing investment over saving but the only advantage of saving in this comparison is that, you can pull out savings anytime as for investment, either you pull it out prematurely resulting in small profit or loss because you happen to pull out the investment at the time when the value of the investment was tanking or lower than your initial entry to that investment.

Apart from that, saving always has problems with inflation. So, the value of your savings could decrease without reducing the amount. However, with investment, we can generate additional income at any time.
However, I also think that it would be better to prioritize investments because they can be a very good thing when we have entered old age, or perhaps retired. The investments we make today can be a new source of income, and in fact, in many cases, people who focus on investments have much more income from investments than from their main job. However, investing is a very good thing, but we also need to save because we don't want to sell the investments we have when we need money in an emergency. at that time, savings are very necessary.

Saving always has problems with inflation but you also need to know that investing also has risks, you can even lose all your assets if you invest in the wrong field or project. Each has its pros and cons, don't always think that saving is wasteful or not worth doing.

I want to ask you, you invested in bitcoin and your investment is losing 50% and you need money for emergencies. Would you sell your bitcoins and accept a 50% loss in value? Meanwhile, if you have savings, you will be able to handle your emergency situation easily .

Everyone always talks about inflation but do people really understand how inflation happens and how it affects our lives in the short and long term?

[Fara Chan]

For now inflation is eating up fiat all over the world now, the option is to either invest in Bitcoin or any other asset that will reduce your level of lost to inflation. Investment is the best option now. Any money you keep on bank does not only reduce in value but it is also not working out money for you. The most important thing to make you succeed is to invest. The moment we always think about investment the more we understand and have the thinking of a rich person because investment is the key to richness or success.

Investing in assets that already have added value and are liked by many people has now become very important because this must be done under any circumstances. Not only in conditions of inflation, but in conditions that must be done anyway if we want wealth or success in our own lives in the future. Because saving money anywhere is not the key to getting more money other than just facing conditions of decreasing value when the price of goods starts to increase every year.

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Apart from that, saving always has problems with inflation. So, the value of your savings could decrease without reducing the amount. However, with investment, we can generate additional income at any time.
However, I also think that it would be better to prioritize investments because they can be a very good thing when we have entered old age, or perhaps retired. The investments we make today can be a new source of income, and in fact, in many cases, people who focus on investments have much more income from investments than from their main job. However, investing is a very good thing, but we also need to save because we don't want to sell the investments we have when we need money in an emergency. at that time, savings are very necessary.

Exactly, that's another reason why savings alone won't be a big deal in the long run, inflation will definitely destroy that savings in no time and when you know that you've got 1k USD in savings but then you will be surprised that next month, it's probably valued or worth 998.9 USD, that's how vicious inflation is, that's why when I asked a friend that's been working as a financial advisor, they'll almost always say that it's a good idea to be investing instead of saving alone. Another thing to consider about investing is that you're going to need to balance a life worth living and investing because if you're just investing your money alone and you're forgetting to have fun, the cycle of monotony and despair will be on you and you're not going to reach the age of retirement if you're only focusing on those investments and not having fun, don't put all the money in investments, try to get a vacation at least 2 times a year and get a hobby.

Investment and saving have various advantages and disadvantages. You have a valid point that inflation would be against your savings plan in the long run. This is why there are disadvantages to saving, but rather, you still have the saving, and it could be useful one day to you regardless that the purchasing power has reduced. Now let's get over to investment. If you invest that $1k in something and later do not receive any return on your investment,. You will feel regretful, since we know that investment is high-risk, and the nature of your investment determines the amount of risk you are taking.

So i think both are crucial. You can invest and, at the same time, still save a little. I cannot prioritise one over the other, as i deem it necessary for both to put into consideration.

[knowngunman]

Somehow we should think about saving for the time of emergency so that we have to get something when we immediately needed some funds. We can't be so sure when an emergency situation happen so its better to separate some funds for security. Although its really good to invest but the problem there if we can't take out our money when the time we need it the most. For sure we will be in a lot of trouble and for sure to get a lot of stress since we think about we have money but we already put it on some things that we think that can generate us a profit in future but we can't take it anytime we want.

What do you mean by we can't take it any time we want? Aside ponzi, is there any other investment that you will not be able to take your money when needed? I don't think so. One thing with investment of this type is you might be swimming in a lose if you want to take your money at the wrong time. When you hear invest what you can afford to lose, this is the situation they are talking about. You don't invest with the money you might need for emergency no matter how profitable the investment sounds unless you're ready for the risk ahead.

Apart from that, saving always has problems with inflation. So, the value of your savings could decrease without reducing the amount. However, with investment, we can generate additional income at any time.
However, I also think that it would be better to prioritize investments because they can be a very good thing when we have entered old age, or perhaps retired. The investments we make today can be a new source of income, and in fact, in many cases, people who focus on investments have much more income from investments than from their main job. However, investing is a very good thing, but we also need to save because we don't want to sell the investments we have when we need money in an emergency. at that time, savings are very necessary.

Reading from OP I see how everyone is speaking about the cons of savings. With no doubt, the value of your savings could decrease without reducing the actual amount saved but are you also aware that in investment, the value of your investment can also decrease drastically without reducing the actual size of the investment? I see both investment and saving as two different entities meant for separate purposes. Everyone can save but not all can invest, it depends on your goals and plans for achieving them.

[batang_bitcoin]

Some savings are necessary in life as these savings will be some recourse in your old age. But of course, investment should be given priority over savings. According to me, investment should be prioritized for four reasons.

For the older ones, savings are a must because they can't take any longer risk unless they've got a huge savings that they can attain to lose money by taking risks with investments. It's best for the younger ones to invest at an early stage because they can attain to make mistakes and they can recover eventually, that's why the old ones are good to have with what's left on them if they ever have saved and invested at their young age. And as they grow old, it's best to them to just enjoy the profits they've made to enjoy life.

Enjoying life is one of the goals when we are required to invest, by investing we can expect something better, especialy in financial terms. But for me saving and investing are both equally good and if possible it's better to do both. We can use our savings when something sudden happens that requires us to spend more money, so our investment will not be disturbed because we still have savings.

We can also use savings for investment, for example when we have a lot of savings we can allocate it to investment. I think that is a good way to do it, because it has many advantages that we can utilize.

It's like our end game for this life, we just want to enjoy but if you start to save and invest later, you'll just enjoy it later too. While those that have started too early, that means that they can also enjoy it too but earlier. So you choose what makes you think that you're suitable to enjoy life early but you didn't do necessary actions like buying assets at your early age and when you didn't saved that money of yours but used it for nonsense things.

[erep]

Reading from OP I see how everyone is speaking about the cons of savings. With no doubt, the value of your savings could decrease without reducing the actual amount saved but are you also aware that in investment, the value of your investment can also decrease drastically without reducing the actual size of the investment? I see both investment and saving as two different entities meant for separate purposes. Everyone can save but not all can invest, it depends on your goals and plans for achieving them.

Saving fiat experiences high losses if we keep it in the bank for too long because of the main loss impact due to inflation, imagine that $100 currently is enough for food costs for one week but one year from now we will need almost $200 for food costs due to the increase in goods and services, so it's time for us change your mindset to convert savings into investment assets that we are sure can be stable and gain profits for the long term, the main choices are gold and land investment but you also have to allocate some for bitcoin investment when market prices fall significantly because the certainty of the crypto market increase is guaranteed for the long term long.

[franky1]

Exactly, that's another reason why savings alone won't be a big deal in the long run, inflation will definitely destroy that savings in no time and when you know that you've got 1k USD in savings but then you will be surprised that next month, it's probably valued or worth 998.9 USD, that's how vicious inflation is, that's why when I asked a friend that's been working as a financial advisor, they'll almost always say that it's a good idea to be investing instead of saving alone. Another thing to consider about investing is that you're going to need to balance a life worth living and investing because if you're just investing your money alone and you're forgetting to have fun, the cycle of monotony and despair will be on you and you're not going to reach the age of retirement if you're only focusing on those investments and not having fun, don't put all the money in investments, try to get a vacation at least 2 times a year and get a hobby.

savings accounts swing at like 4% a year. -4% inflation +4% bank interest
however investments swing 8%+.. and here is the thing.. the investment swing is not always positive in investments..
so selling out an investment at a bad time can be a investment loss more then 4% loss.. so you dont want to rely on all your funds being in investments

so putting all your savings into a investment can lose you more money when a surprise happens

the point of  savings account is not wealth accumulation.. its a rescue buffer so you dont need to sell investments at a bad time

all you need in savings is initially  a months worth of true lean expenses (bills)
EG a stop gap if unemployed between losing job and getting new jobs first pay cheque or social security unemployment payment

if you have a mortgage. you dont need to fund the full monthly mortgage amount into savings. you can just do the 'interest only amount' and then add in the ESSENTIAL bills and bare/cheap/necessary groceries to feed you basic meals for the month

so first save that small emergency rescue pot of money.. and realise that the small $1k may not gain money, but the amount it loses is minimal too when considering everything..

THEN the next month put your other excess income into investments knowing you can THEN invest from now on without worry or panic of needing to rush to cash out investments.. because the savings pot is there instead. to rescue you and give you a month of peace to not need to react in an instant