Saving vs Investing
By:Michelle Butts
Difference between Saving vs Investing & Importance
The difference between saving vs investing is the degree of liquidity. The importance of Saving is that you can save for the future and save some money for when you might need some. The importance of Investing is that your investing into something and increasing income.
Liquidity
Liquidity is how quickly and easily as asset can be converted in cash. Such as if an individual were to have an emergency, cash needs to available in a savings tool that is easily accessible.
Assets, liabilites and Net worth
Assets is everything an individual or household owns with monetary value.
Liabilities is Debts. Ex: what is owed to others.
Net Worth describes an individual or family financial condition on a specified date.Ex amount of money left when liabilities are subtracted from assets.
Interest Rates, Saving Portions, and Automatic
Interest rates is the percentage rate paid on the money invested or saved
Saving Portions 10-20%
Automatic pay yourself first a popular and effective strategy. it means to set aside money.