JOHANNESBURG – While it’s becoming increasingly difficult to find the extra money each month, the concept of saving seems fairly straightforward to many of us. Investing, on the other hand, often comes across as more of a complicated exercise.
While they both involve keeping a portion of your income aside for future use, investing targets growth so that your money actually makes more money – and it’s easier than you think.
According to Prudence Thipe, General Manager at Old Mutual, understanding the difference between the two is the first step toward realising your financial goals.
“Saving simply means not spending. So, if you put money away each month in a jar or under a mattress you are saving but it won’t grow. Investing is the next step – it’s what you do with that saved money, and how you grow it.”
According to Thipe – this is where many of us fall short. “The latest Old Mutual Savings and Investment Monitor revealed that 76% of black households made use of informal savings vehicles like stokvels, unbanked cash savings, grocery schemes and burial societies with 34% of stokvel assets unbanked or held in cash.