How is investing really beneficial?

First, we need to know the difference between savings and investment, then its benefits will be known in the future. Inhale as soon as the air comes in.

In article's

1,First let's have a brief look at savings, investment

2,Let us see the difference between the two with an example.

3,Every investment has its drawbacks

First let's have a brief look at savings, investment

storage; Money set aside for your needs. It will remain the same. It does not grow. For example, money stored in a safe deposit box at home alone.

investment; When you need it, the money saved is kept somewhere else instead of just being kept. Because money doesn't stay the same in that other place. is growing There are various examples of that other place; Bank Savings Account (This also has an interest rate. Money grows.), Bank Fixed Deposit, Employee Provident Fund, Public Provident Fund, Post Office Savings Schemes (Post office Saving schemes, National Savings Scheme, Kisan Vikas Patra etc., Ancient Painting, Ancient Artifact, Chartered Land, Built House, Mutual Fund Schemes, Stock Market Shares)

Let us see the difference between the two with an example.

Not investing, just saving;

A mother in the year 1979, Rs. Suppose he deposits 10,000 in a safe deposit box. Now, it is worth Rs. 10,000 only.

Investment in gold;

If he had invested the same money in gold, if it had been invested in gold in 1979, the price of 10 grams of gold would have been (Rs. 937). For 10000 rupees, you can buy almost 10.67 grams of gold. Today's gold price (Jan 19, 2023), 10 grams of gold costs Rs 55,500. That is, it has increased by 45.00 times. So, 10000 x 45,00 = Rs. 4,50,000/- would have increased.

Investing in stock market index based mutual funds;

If the same money had been invested in an index based mutual fund, it would have multiplied by 364.81 times (today's stock index; 63,384). So, 10000 x 63,384 = Rs. 633,840000/- would have increased.

Every investment has its drawbacks;

Every investment has pros and cons. In every investment three elements of risk, liquidity and rate of growth vary from investment to investment. For someone new to investing, read my advice in the following post.

Impact of Inflation;

Thus, money has no chance of multiplying if it is not invested in any way. In an inflationary society, if no investment is made, the same standard of living cannot be maintained. Today, we cannot live the standard of living we had in 1979 on Rs 10,000. A house can be bought for Rs 10,000 that day. Today, we can pay only one month's rent.

 warning; There is also the risk of losing money in investments. Be very careful.

 As Warren Buffett said,

 The first rule; Never lose money

 The second rule; Never forget the first rule.

Therefore, investment is very necessary. Let's start early and harness the power of compound interest to grow money and make retirement a comfortable one.