No one has ever saved their way to wealth. Investing has always,… yes! always been the way to wealth.

However, there are reasons for some, where saving may be better than investing. One of the key reasons you should save money is to invest it.

We save with the intention to spend money in the future, we invest with the intention to earn money in the future.

Without saving money, investing won’t be prudent.

Now let’s dig in on when saving money is better than investing.

Saving is better than investing for a person who is just starting to work. This can be the teenager living at home, the recent graduate beginning a new career, or a person in transition from job to job.

Saving is better than investing for a person who does not like or tolerate risk. Some people are just risk averse. I never had this problem. I like risk. Risk taking is in my blood. I learn to manage and understand it.

I like this quote by Warren Buffett that says “I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.”  Understand risk and learn to manage them if you want to invest.

Saving is better than investing for a person who doesn’t understand basic and advanced financial concepts. Some people either don’t care or want to understand financial concepts. Understanding real estate, business development, stock, and stock options financial concepts is the first step to investing. When it comes to investing, nothing will pay off more than educating yourself. Do the necessary research and analysis before making any investment decisions.

“An investment in knowledge pays the best interest.” — Benjamin Franklin

Saving is better than investing for a person who doesn’t like to make mistakes. Some people equate mistakes with failing. Mistakes are temporary. When I look back at my investing experience, learning from my mistakes propelled my growth.

I agree with Carlos Slim Helu when he said “With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future.” 

Saving is better than investing for people who have really high incomes and don’t have the time to invest. These people might not trust others to invest for them. Investing in anything takes time that others might not have. But these people should always remember; “the biggest risk of all is not taking one.” — Mellody Hobson

Saving is a foundation. Investing is the vehicle. Build wealth through investing!

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