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Should I Invest or Save My Money?

When you spend a long time working, paying off bills and looking after the family; it is good to know that sometimes you have money left over at the end of the month. Now, of course you could save the money up in an account and accrue interest over a period of time, or maybe you prefer the idea of investing your money to earn a return. But if you are sat on the fence, not knowing what to do with your money, here are some things to think about.

Who should save?

Before you think about saving up, you need to first write down your expenses and see what comes out of your account each month. Use a budget planner to get a clear picture of your finances and decide where you could cut costs. For example you could shop around for lower energy bills if they are a little steep.

Setting up an emergency fund

Everyone needs a buffer to fall back on if life doesn’t go to plan. Ideally, you should be looking to save up three months of your wage to give you a little security in case anything ever happens.

Keep saving

Once you’ve got that emergency fund, you may also want to look into saving even further. It is a good idea to try and save up approximately 10% of your earnings every month, it will build up over time and allow you to go on a family holiday or pay for Christmas.

Who Should Invest?

If you find that you have a reasonable amount in your savings and still have some money leftover, investing that money could be a great way to earn some extra cash. You could opt for buying an  Icon Property and renting it out to tenants, or perhaps you would rather try your hand at the stock market.

How you decide to invest depends on your goals for the future:

Short-term goals – within the next five years.

Medium-term goals – within the next 5-10 years.

Longer-term goals – you won’t need the money for ten years or more.

Short-term goals

If you have short term goals to buy a house, or travel the world. Saving up your money in a bank account is a better option. Investment can be risky and may not bring you a reasonable return in five years.

Medium-term goals

Cash deposits are a great option here, but it depends how willing you are to take the risk. If you are flexible, you could invest your money and take the risk of not winning a profit, and you may actually benefit from it.

Longer-term goals

Investing in your retirement is an example of a long term goal you want to achieve. Most people choose to invest in a pension scheme because it gives that security for the future.

If you are looking at longer-term goals, investment is a great option because if you put in a small amount of money now, inflation over the years will mean the value can become significantly higher by the time you take the money.

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