--- title: 5 Important Differences Between Savings & Investing. description: "\"Savers are losers,\" says Robert Kiyosaki, and he is right. Many people think that Saving and Investing are same, but in reality, they are quite different..." image: https://www.financialplanningindubai.com/hubfs/AibKqx8i4.jpg --- [![Financial_Planning_in_Dubai_logo](https://www.financialplanningindubai.com/hs-fs/hubfs/Financial%20Planning%20in%20Dubai%20Logo_9090-2.png?width=90&height=90&name=Financial%20Planning%20in%20Dubai%20Logo_9090-2.png "Financial_Planning_in_Dubai_logo")](https://www.financialplanningindubai.com/?hsLang=en-gb) - [Home](https://financialplanningindubai.com/) - [Blog](https://www.financialplanningindubai.com/blog) - [Services](https://www.financialplanningindubai.com/services) - [Islamic Investments & Takaful Plans](https://www.financialplanningindubai.com/blog/salama-hyat-plus-takaful-plan) - [Medical Insurance](https://www.financialplanningindubai.com/blog/topic/medical-insurance) - [Free Resources](https://www.financialplanningindubai.com/free-finanical-tools) - Tools - Calculators - [S&P 500 Investment Calculator](https://financialplanningindubai.com/sp-500-investment-calculator/) - [Life Insurance Calculator](https://www.financialplanningindubai.com/life-insurance-calculator) - [SIP Calculator](https://financialplanningindubai.com/sip-calculator/) - [Lumpsum investment calculator](https://www.financialplanningindubai.com/lump-sum-investment-calculator) - [Inflation Calculator](https://www.financialplanningindubai.com/inflation-calculator-uae) - [Net-Worth Calculator](https://www.financialplanningindubai.com/blog/free-personal-balance-sheet-template-networth-statement) - [The Best Budget Planner for Expats](https://www.financialplanningindubai.com/expat-budget-planner) [Book A Discovery Call](https://www.financialplanningindubai.com/meetings/damodhar?hsLang=en-gb) # 5 Important Differences Between Savings & Investing. ![Damodhar Mata](https://app.hubspot.com/settings/avatar/e63bc971ec29ebe6c012fd042c1a8215) [Damodhar Mata](https://www.financialplanningindubai.com/blog/author/money-mata-aka-damodhar-mata) 23 Jan 2018, 17:32:42 ## "Savers are losers," says Robert Kiyosaki, and he is right. #### Many people think that Saving and Investing are same, but in reality, they are quite different... ##### The following are the 5 important differences between Saving & Investing; #### Short vs Long Savings is for emergency and short-term needs, whereas investing is ideal for medium and long-term financial goals. ![AibKqx8i4](https://www.financialplanningindubai.com/hs-fs/hubfs/AibKqx8i4.jpg?width=320&name=AibKqx8i4.jpg) #### Idle vs Active When you save money in a bank, it lies idle, earning interest much less than the prevailing inflation. Whereas when you invest your money works hard for you and makes more money. Positive vs Negative Compounding Investing helps you benefit from positive compounding, whereas saving for long-term goals is affected by negative compounding due to inflation. Read: [Inflation Calculator - Know the impact of inflation on your savings.](https://www.financialplanningindubai.com/blog/inflation-calculator?hsLang=en-gb) #### Capital vs Wealth Savings helps you accumulate capital. Investing helps you beat inflation and adds more money to your capital, thus helping you grow wealth. #### Liquidity vs Income Savings provide liquidity, but [Investing](https://www.financialplanningindubai.com/blog/2017/03/14/how-to-invest-for-passive-income-in-uae?hsLang=en-gb) can provide a regular income. Particularly during retirement and periods of low or no income, Savings create a feeling of scarcity, as to what will happen when the savings exhaust. Whereas investing creates a feeling of abundance, due to the income from investing. Read: [How to invest for passive income?](https://www.financialplanningindubai.com/blog/2017/03/14/how-to-invest-for-passive-income-in-uae?hsLang=en-gb) Easy access to money saved creates an urge to spend, whereas money invested for long-term goals grows and multiplies. Read: ["A penny saved is a penny spent elsewhere"](https://www.financialplanningindubai.com/blog/penny-saved?hsLang=en-gb). #### Summary It is enough to have savings equal to emergency needs and short-term needs. And it is very important to [invest](https://blog.financialplanningindubai.com/blog/2015/03/04/how-to-invest-money-in-uae?hsLang=en-gb) to achieve medium to long-term goals, grow wealth and leave a lasting legacy. #### Expert Advice As a Qualified and Independent Financial Advisor, I can help you invest for our medium to long-term financial goals. Arrange a Free Consultation to help you identify your financial goals and set up an action plan for achieving them. [![Let's Talk !](https://hubspot-no-cache-eu1-prod.s3.amazonaws.com/cta/default/2672634/7e83ba4e-b652-47ae-8049-808937aca2d2.png)](https://hubspot-cta-redirect-eu1-prod.s3.amazonaws.com/cta/redirect/2672634/7e83ba4e-b652-47ae-8049-808937aca2d2) ![Damodhar Mata](https://app.hubspot.com/settings/avatar/e63bc971ec29ebe6c012fd042c1a8215) [Damodhar Mata](https://www.financialplanningindubai.com/blog/author/money-mata-aka-damodhar-mata) Author, Blogger & Independent Financial Advisor. My goal is to give you actionable tools for creating passive income and building wealth. More than 10,000 expats have already used my ideas to jumpstart their journey towards financial independence. Connect with me to start yours... Share this article on [mailto:?subject=Check%20out%205%20Important%20Differences%20Between%20Savings%20&%20Investing.%20&body=Check%20out%20https://www.financialplanningindubai.com/blog/5-important-differences-between-savings-investing](mailto:?subject=Check%20out%205%20Important%20Differences%20Between%20Savings%20&%20Investing.%20&body=Check%20out%20https://www.financialplanningindubai.com/blog/5-important-differences-between-savings-investing) ##### Read more - [The Real C-Suite – The Only Title That Matters 🏆](https://www.financialplanningindubai.com/blog/breadwinner?hsLang=en-gb) - [The Wealth Secret 99% of Investors Ignore – Will You?](https://www.financialplanningindubai.com/blog/the-iceberg-of-investing?hsLang=en-gb) - [From Risk to Reward? The Shifting Case for China Investing](https://www.financialplanningindubai.com/blog/from-risk-to-reward-the-shifting-case-for-china-investing?hsLang=en-gb) ## Further Reading [![3 irrational retirement planning misconceptions you must avoid!](https://www.financialplanningindubai.com/hs-fs/hubfs/Imported_Blog_Media/retirement-cancelled-7.png?width=300&name=retirement-cancelled-7.png)](https://www.financialplanningindubai.com/blog/retirement-planning-misconceptions?hsLang=en-gb) ###### [Retirement Planning,](https://www.financialplanningindubai.com/blog/topic/retirement-planning)[retirement savings in dubai](https://www.financialplanningindubai.com/blog/topic/retirement-savings-in-dubai) ##### [3 irrational retirement planning misconceptions you must avoid!](https://www.financialplanningindubai.com/blog/retirement-planning-misconceptions?hsLang=en-gb) According to The Second World Happiness Report, more than half of UAE employees are worried that... [Read More](https://www.financialplanningindubai.com/blog/retirement-planning-misconceptions?hsLang=en-gb) [![Can you save one month's income? - Tick a Week Savings Challenge 2024](https://www.financialplanningindubai.com/hs-fs/hubfs/Tick%20-%20Week%20-%20Savings%20Chaallenge.png?width=300&name=Tick%20-%20Week%20-%20Savings%20Chaallenge.png)](https://www.financialplanningindubai.com/blog/tick-a-week-2019?hsLang=en-gb) ###### [Savings Challenge,](https://www.financialplanningindubai.com/blog/topic/savings-challenge)[Tick a Week](https://www.financialplanningindubai.com/blog/topic/tick-a-week) ##### [Can you save one month's income? - Tick a Week Savings Challenge 2024](https://www.financialplanningindubai.com/blog/tick-a-week-2019?hsLang=en-gb) Do you want to save more in 2024? [Read More](https://www.financialplanningindubai.com/blog/tick-a-week-2019?hsLang=en-gb) [![Top 10 retirement quotes that inspire to save & invest for your future](https://www.financialplanningindubai.com/hs-fs/hubfs/Top%2010%20retirement%20quotes%20%28800%20x%20400%20px%29.png?width=300&name=Top%2010%20retirement%20quotes%20%28800%20x%20400%20px%29.png)](https://www.financialplanningindubai.com/blog/top-10-retirement-quotes-that-inspire-to-save-invest-for-your-future?hsLang=en-gb) ###### [Retirement Planning,](https://www.financialplanningindubai.com/blog/topic/retirement-planning)[Retirement Quotes](https://www.financialplanningindubai.com/blog/topic/retirement-quotes) ##### [Top 10 retirement quotes that inspire to save & invest for your future](https://www.financialplanningindubai.com/blog/top-10-retirement-quotes-that-inspire-to-save-invest-for-your-future?hsLang=en-gb) Words have power. When delivered with the right intent and energy, they incite, empower and... 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