Investing and saving are important concepts for money management. Saving preserves money for future expenses while investing allows money to grow. It is best to balance saving and investing, as going to one extreme or the other can impact financial stability. It is suggested to invest surplus funds after keeping some in savings for emergencies. Proper money management through a balance of saving and investing can increase wealth over time.

1. Investing and saving are two important concepts of money management.
Saving is the act of preserving money to meet future expenses and to be
protected from uncertainties. Investing is the act of committing your money
somewhere where it is allowed to grow.
A greater balance in these two will increase your wealth at the same time will
save you from unfortunate financial requirement. Going one side towards
either saving or investing may affect your financial stability.
Going for saving without investing, won't cause your financial weakness but
your fund won't grow, you will not get full value of your effort. Someone else,
may be bank will enjoy the return from your money. On the other side if you
invest all your money without savings, then you will face difficulty during urgent
need of cash due to certain situation.
It is suggested to invest your surplus amount after keeping some reserve to
meet your emergency requirement.

2. Here is a quote,
Workers earn it,
Spenders burn it,
Bankers lend it,
Women spend it,
Counterfeiters fake it,
Taxes take it,
Successors receive it,
Thrifty save it,
Hoarders crave it,
Robbers seize it,
Rich increase it,
Gamblers lose it,
Stock brokers multiply it........ What is it ??? It’s Money !!!
Being crispy, you should invest to multiply your money to cater future needs.

3. Money controls every relationship in life, every interpersonal interaction:
friendship and courtship, partnerships, investments, living together, marriage,
divorce, death and etc! Everyone needs money to increase his personal
freedom, sense of security and ability to afford the things he wants in life. Till
death or even after death money is required.
Some people need more money to maintain luxurious life and some to just
maintain their life. For the first category people they must have to go for
investing as it is one of the best ways to earn more money. For the second
category, it is unfortunate to hear that, pension scheme have been stopped in
most private and public sector companies. It is essential to go for investing in
order to have financial stability after retirement.
Everybody wants to save money. Saving = Income - Expense, In order to save
you have to either increase income or reduce expense. Second option has a
limit, you can't reduce expense after a certain limit depending on your style of
living. But first one has no limit.

4. You can have very high income from different source based on your Zeal to
excel and consistent effort to achieve success. You can enjoy life while saving
for uncertainty. Investment in share market is a high return investment.
Once Bill Gates said,
" If you born poor, it is not your mistake But if die poor it is your mistake".
Why to do the mistake ?
You can be sure that if you don't put your money to work someone else will and
take the profit for him

5. Do you have few hundreds of rupees or few dollars? Yes!! Then you can invest
it. Anybody having few hundreds of rupees or few dollars as surplus amount
can invest. You can invest it in stock market, mutual fund, bonds or gold etc.
depending on your personality and investment objective.
Age limitations are depending on your country rules. That you can clarify with
your broker. In India there no age limitation for investment
There are various fields to invest. Depending on your personality, interest, risk
taking capability, amount of investment, objective of investment etc. you can
choose where to invest. Two major factors decide investment strategy i.e.
1. Amount of return and
2 Amount or risk to loose
We suggest that, you understand minute details before investing in Stock
market and Mutual funds, other investments like Real estate or gold etc. can be
decided with little compromise

6. There are many types of investment depending on gain and risk. Always
remember gain is directly proportional to risk. Whenever there is expectation
of high gain, there is a chance to lose. Higher the gain higher the risk. There is
no source of gain without risk except you father's bank account.
Stock, bond, Mutual fund, Currency trading, Commodity trading, are common
category of investment in share market. Except these here are many other
sources for investing. For example, you can open your own business,
investment in real estate, investment in gold etc.
Each category requires different skill and time and has different gain
percentage. Depending on your interest, personality and skill you may select
any one or more. We will discuss about investment in Stocks, Mutual Fund and
Bonds since these takes major part in share market.

7. Types of investment are the available investment source. Types of investing
refer to the various styles or strategies of investing.
All road leads to same destination. Like this, investment strategies are the road
to be followed to reach your target. You may follow any road to your interest
and personality but aim and importantly the destination.
Some people are conservative in their investment strategy and some are
aggressive. It is seen that both of them get success.
There is no defined investment strategy, no theorem or no law like physics and
chemistry; you can follow your own. Once you learn basic thing and start
investing, automatically your investment strategy will be defined based on you
risk factor and personality. But certain proved mistakes should be avoided and
certain proved success tips may be taken care so that you save some of your
time and money

8. It is clear that the more time you keep money you will get more interest.
Starting early will give you more amounts at the end. For example, Say John
and Mihir both are of same age now at 50 years. John invested Rs 10,000 when
he was 20 years old @ 10% interest but Mihir invested the same Rs 10,000 at
age of 30 Years. If interest is compounded annually, at age of 50 John will have
Rs191, 000.00in his account where Mihir are will have Rs 74,000.00 (appx.) In
his account. See the difference.
This clearly says you should start early. But, that doesn't mean that you invest
money without knowing anything, in hurry.
Stop procrastination. Start now

9. You would have heard the word "Inflation". It is general increase in price of
average products over time. The opposite is deflation.
It is measured annually in percentage. For example, if inflation is 5% in 2009
then, cement/bag pricing Rs 200 in 2009 will have a price of Rs 210 in 2010. It
indicates that inflation decreases purchasing power of money, i.e. the Rs 200
can buy the cement bag in 2009 but the same Rs 200 can't buy the same
Cement in 2010.
Inflation is calculated based on a group of product. If inflation is 5% that doesn't
mean that the entire product will increase by 5%. There are some products
which price would have come down also.
Let’s understand the effect of inflation and interest rate on investment. Almost
everyone thinks inflation is evil, but it isn't necessarily so. Inflation affects
different people in different ways. It also depends on whether inflation is
anticipated or unanticipated. If the inflation rate corresponds to what the
majority of people are expecting (anticipated inflation), then we can
compensate and the cost isn't high. For example, banks can vary their interest
rates and workers can negotiate contracts that include automatic wage hikes as
the price level goes up.

10. Problems arise when there is unanticipated inflation:
Creditors lose and debtors gain if the lender does not anticipate inflation
correctly. For those who borrow, this is similar to getting an interest-free loan.
If the inflation rate is greater than that of other countries, domestic products
become less competitive.
People living off a fixed-income, such as retirees, see a decline in their
purchasing power and, consequently, their standard of living.
People like to complain about prices going up, but they often ignore the fact
that wages should be rising as well. The question shouldn't be whether inflation
is rising, but whether it's rising at a quicker pace than your wages or your
return on investment.
Finally, inflation is a sign that an economy is growing. The lack of inflation may
be an indication that the economy is weakening. It is important for investors to
understand effect of inflation and interest rate on investment

11. Can you afford to lose all your money invested in market? If yes then you can go
forward, on the other hand you rethink about your financial position. First of all
make yourself stable, make your family protected from market declines and
unfortunates.
A 70 year old widow will be more conservative than a 30 yr executive who has a
full time income except investment. Hence age and financial position drives
your investment strategy. Invest the money which you can afford to lose. From
the beginning, if you don't have experience or some degree in this stock
market, then it is recommended that you make it as part time work. After you
get confidence in investment you can take it as full time.
Again, be debt free before investing. Don't invest money taken from loan.
Because if you lose money invested then you may come to the road.
Be careful! Always remember borrower is servant of lender. Avoid borrowing

12. Always remember, you can put your best effort on something that you are
interested in. If you are interested in computer programming, you can do
wonders in that. If you are interested to be writer and by family pressure or due
to some reason you want to become an investor in share market, then probably
you have to re-think.
Some people if got news paper directly will go to business page and some may
not know that there is a business page. Second kind people may have to re-
think before investing in share market.
Do you enjoy thrill or fast racing or you enjoy the slow blowing of air at low
speed? Can you sleep at night if there is a chance that all your invested money
you may lose tomorrow? Investment, especially in stock is controlled by thrill,
gambling and challenge. If your personality suits it you can play the game
creatively

13. What is 8th wonder of world ?
In Albert Einstein's word,
"The eighth wonder of the world is compound interest!”.
Compounding is the process of generating earning from reinvestment or
earning. To work, it requires two things: the Re-investment of earnings and
Time.
Let’s take an example,
You invested Rs 10,000 in 1990 @ 10% interest. In 1991 you will have value of
Rs 11000(10000+10% of 10000). If you are not withdrawing the interest of Rs
1000 then it will be reinvested. So in 1991 you will have value of Rs 12100. Say
you kept it for 40 years hence in 2030 you will have Rs 45, 2593. See how
compounding creates magic.
In stock market if you go for reinvestment of your earning you may huge
amount with the power of compounding.

14. Real investor doesn't simply purchase stock like purchasing Cake. Real investor
understands value of his money. He analyzes the stock, gain expectation and
risk involvement and then only decides to buy or sell. True investment can be
done with dedication and involvement. You have to spend enormous time in
front of computer and with the news paper to become a real investor.
"Invest time before investing money"