Saving vs. Investing
Before deciding where to put your money, it’s important to understand the difference between saving and investing.
A bank account provides stable interest income, and often the flexibility to withdraw cash quickly if needed. The amount held in a savings account or term deposit will not fall, however its value could erode if the interest earned on the account does not exceed the inflation rate.
When investing your money, there is a wide array of asset classes and investment types for you to choose from, and many investors choose to diversify their portfolio across a range of investments. Investment returns are earned through:
The potential return earned from an investment is directly related to the potential risks, and so selecting an investment that suits your risk appetite is key.
Consider your goals
The decision on whether to invest or save will often depend on your financial goals, when you want to achieve them, and how much risk you are comfortable taking on:
Understanding your goals, time frame and risk appetite will help you decide whether investing is right for you, and also guide which investments may be most suitable.
*Graph compares the value of $10,000 saved/invested on 31.08.1998 to the value of the investment/saving on 31.07.2015, as calculated using relevant indices: the value of Savings is calculated using the Bloomberg AusBond Bank Bill Index; Bonds using the Bloomberg AusBond Composite 0+ Year Index; Equities the S&P/ASX300 Index, with returns include dividends reinvested, but excluding franking credits. Past performance is not an indicator of future performance.
Any advice is general advice only. It was prepared without taking into account your objectives, financial situation, or needs. Before acting on this advice you should consider if it's appropriate for your particular circumstances. You should also obtain and consider the relevant Product Disclosure Statement and terms and conditions before you make a decision about any financial product, and consider if it’s suitable for your objectives, financial situation, or needs. Investors are advised to obtain independent legal, financial, and taxation advice prior to investing.
Investments are not deposits or other obligations of, guaranteed, or insured by Citibank N.A., Citigroup Inc., or any of their affiliates or subsidiaries, or by any local government or insurance agency, and are subject to investment risk, including the possible loss of the principal amount invested.
Investors investing in funds denominated in non-local currency should be aware of the risk of exchange rate fluctuations that may cause a loss of principal.
Past performance is not an indicator of future performance.
Investment products are not available to US people and may not be available in all jurisdictions.
All investments are subject to risks and can change in value.