Savings vs. Investments – striking the right balance for your goals

Savings and investments are both strategies that share a common financial goal – to grow your wealth. Despite this key similarity, there are a few differences between the two, and finding the right balance can assist you in building a more stable financial future.

Navigating the decision of when to save and when to invest can be challenging, so we’ve provided some tips below to help you decide.


As we know, savings form from setting aside a portion of your income into a low-risk savings account that can accrue interest over time… but when is it best to do so?

When to save:

  • If you’ll require the money in the next few years – when working towards a goal that you know you’ll require funds for in the near future, a savings account offers enhanced liquidity and flexibility.
  • If you haven’t already built up an emergency fund to cover unexpected expenses – it is often recommended to have an emergency fund set aside should something happen and you are unable to work. This is also useful before implementing an investment strategy, as it can help mitigate potential risk.
  • If you have a low appetite for risk – if your risk tolerance is low, you may feel more comfortable putting your money into a savings account as opposed to investing which can be unpredictable and carries a higher level of risk.


Investments involve putting your money into assets with the expectation of generating returns over time and can include stocks, bonds, real estate, and more. As already mentioned, one of the key differences that set investments and savings apart is the level of risk, so consider the following scenarios before proceeding:

When to invest:

  • If you don’t require the money for a longer period of time e.g., five years – investments take time and patience and are not typically intended as a short-term strategy. If you’re comfortable with not accessing your funds until the distant future, you may be ready to invest.
  • If you have a cash emergency fund to help manage the risks of investing – no one can predict what the markets will do with 100% accuracy, so it’s recommended to have an emergency fund as a buffer against unforeseen events.
  • If you’re comfortable with taking some risk to build your wealth – the world of investing is unpredictable, continuously changing, and at times, volatile. Understanding and accepting the level of risk before proceeding may instil you with more confidence throughout the process.

By striking the right balance between savings and investments, you can pave the way towards a more secure financial future. If you’d like to tailor a strategy that aligns with your goals, get in touch with your financial adviser.

Platinum Investments (NSW) Pty Ltd and Trimac Holdings Pty Ltd, trading as PT Wealth ABN 16 698 445 925 is a Corporate Authorised Representative of Infocus Securities Australia Pty Ltd ABN 47 097 797 049 AFSL and Australian Credit Licence No. 236523.
The information contained on this website has been provided as general advice only. The contents have been prepared without taking account of your personal objectives, financial situation or needs. You should, before you make any decision regarding any information, strategies or products mentioned on this website, consult your own financial advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs.

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