Full transcript
0:01are you saving or investing for your
0:03financial future
0:05did you know there was a difference
0:06between saving and investing one may be
0:09the better option depending on what you
0:10have planned for the money you are
0:12investing or saving so what is the
0:15difference between saving and investing
0:17first let's talk about saving saving is
0:20typically setting aside money that you
0:22haven't spent for emergencies or a
0:24future purchase this money could be
0:27placed in a savings account kept in an
0:29envelope in your house or buried in your
0:31backyard
0:31please do not bury money in your
0:33backyard it wasn't a good idea for
0:35pirates and it's still not a good idea
0:37today
0:38this saved money is easy to act
0:41to act and there's little to no risk of
0:42it being lost unless it is somehow
0:44stolen
0:46it can be readily available as an
0:48emergency fund for an unexpected car or
0:50home repair or a planned feature of
0:52purchase like a computer or a vacation
0:55so what about investing if you're
0:57investing you're making your money work
0:59for you by purchasing assets such as
1:01stocks bonds mutual funds exchange
1:04traded funds or another investment
1:06product with the expectation that these
1:08investments will make money for you over
1:10time foreign
1:12there is risk involved here as there is
1:14no guarantee that an investment will
1:16make you money and no guarantee on how
1:18long it might take to make money
1:20due to this risk and time variance
1:22investing is usually a long-term Venture
1:25and uses money you won't need immediate
1:27access to
1:28money you invest is often used for
1:30longer term financial goals such as
1:32buying a house funding post-secondary
1:35education or funding your retirement
1:38another way of seeing the long-term
1:39difference between saving investing is
1:41by looking at an example using the same
1:43amount of money
1:45let's look at what saving and investing
1:47a thousand dollars might look like after
1:4910 years
1:50first we'll look at saving
1:52let's say we're saving a thousand
1:54dollars by depositing it in a savings
1:56account to face 0.25 interest per year
1:58compounded over 10 years
2:01at the end of 10 years your initial one
2:03thousand dollars will now be worth one
2:04thousand twenty five dollars and twenty
2:06eight cents
2:07you've earned twenty five dollars and 28
2:09cents in interest in 10 years
2:13now let's look at investing
2:15let's say we investor a thousand dollars
2:17and we expect an average rate of return
2:18of three percent per year if we were to
2:20get a three percent return each year
2:22after 10 years we would have one
2:24thousand three and a four to three
2:25dollars and ninety two cents remember
2:27though this three percent isn't
2:29guaranteed some years we may make more
2:32some years less some years we may even
2:34lose money on our investment
2:36this example simply shows the difference
2:38investing can provide you when compared
2:40to simple saving over time both saving
2:44and investing had their place when
2:46managing your finances knowing when to
2:49save and when to invest will help you
2:51make better and foreign famous decisions
2:54for more information and resources on
2:56investing please visit our website at
2:59nssc.nova scotia.ca
3:04[Music]