Purpose

• The purpose of saving and investing is to earn money on money that you already have. Savings accounts pay a flat interest rate while investments rely on the price of stocks increasing, thus increasing the value of the stock's shares.
  
  

Risks

• Savings accounts are considered a safe way to store money and earn modest interest as accounts are insured up to $250,000 in the U.S. by the FDIC. Stock prices can fluctuate up and down on any given day, making it possible to gain or lose money.
  
  

Benefits

• The main benefits of saving money is earning a guaranteed interest rate and having the money accessible at any time. The benefit of investing in stocks is the potential for far greater increases in wealth over time at the cost of greater risk.
  
  

Potential

• Stocks have the potential to double or triple an investment over the course of several years, while savings accounts will only increase wealth at a slow annual rate. Historicallym stock investments are better for building wealth over long periods of time.
  
  

Considerations

• Many people choose to use both stock investments and savings accounts. Stocks are primarily seen as a way to build wealth, while savings accounts are a way to preserve wealth.