What is the difference between savings and investments?

Savings and investments are both methods of managing money, but they differ in their goals and risk levels. Savings typically involve placing money in low-risk, highly liquid accounts, such as savings accounts, where it can be accessed easily. The primary goal of savings is to preserve capital and provide for short-term financial needs. Investments, on the other hand, involve using money to purchase assets such as stocks, bonds, or real estate with the goal of generating returns over time. Investments generally carry higher risk, but they offer the potential for greater rewards, making them suitable for long-term financial growth.