By Jerry Mooney

If you have a small sum of money and you want to do something with it, is it best to save it or invest it? This is not an easy question to answer. There are clearly benefits and drawbacks of both options. You can’t afford to ignore the potential problems that come with investing, and you can’t ignore the limitations of saving either. In truth, it’s all about choosing which of the drawbacks you’re most willing to deal with. Read all about what each option means for consumers right now, and then apply these factors to your own situation.

Saving

Saving is becoming a little less popular because of the interest rates being so low. There is not much incentive to put your money into a savings account right now. If you do, your money will grow, but it will grow very slowly indeed. As long as you’re not expecting significant returns, however, it can still be a good option that’s worth considering. There are some options that buck the low interest rate trend too. Apply for a high interest savings account and see what the best deal you can find is if you do want to save your money.

One of the most appealing factors about saving money is that it’s not risky at all. Your funds are assured and as safe as they can be. That’s not what you get when you invest your money. If you are looking for risk, then this obviously isn’t the option for you. You can also access your cash whenever you want it when you put it in a savings account. You can take it out of your account and spend it freely. This makes it very convenient in a way that investing simply isn’t. Getting access to your money is much more complicated when you invest it.

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Investing

Investing your money can mean lots of different things. It can mean buying stocks and shares and trying to make money from them, but that’s not the only form of investing out there. Many people choose to invest in homes and properties. These people then become buy-to-let landlords before selling the home for a profit. You can also invest in a business and take a hands-on role in running it. In other words, there are no limits to the things that you can invest in. And there are pros and cons associated with those investments.

Generally speaking, investing is pretty risky. You are relying on your investments increasing in value if you’re going to make money. That doesn’t always happen though, and that’s when you make losses. On the other hand, when you get your investments right, you can make huge sums of money. That’s something that is never going to happen by saving your money. But be sure to do some research and consider all the options before you go ahead with an investment. You can only make money this way if you know what you’re doing and you’re fully informed and prepared.

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Jerry Mooney is co-founder and managing editor of Zenruption and the author of History Yoghurt and the Moon. He studied at the University of Munich and Lewis and Clark College where he received his BA in International Affairs and West European Studies. He has recently taught Language and Communications at a small, private college and owned various businesses, including an investment company. Jerry is committed to zenrupting the forces that block social, political and economic justice. He can also be found on Twitter @JerryMooney