- Save
- Invest
Saving on its own is not enough. Make sure you earn compound interest on your savings. Compound interest in simple terms it is earning interest on your interest.
Time value of money. Your money is worth more today than next year. It will lose its value due to inflation. You need to invest to earn interest. Interest earned will increase the initial amount you save.
Savings account are great but the interest rate is very low compared to the inflation rate. Investing can help you take out more money than you saved but there are risks associated with investing and it is important seek financial advice before making a decision.
Tip of the day
Investing can enable you to maintain the value of your savings and generate a return.