Savings and investments are both important, and in my own understanding they're supposed to play different roles in a person's income, what is not good economically is spending all your income as they enter. The best thing is for a person to have a budget and determine what goes where, how many percentage for investment, savings and basic expenditures, with this maths the person will not spend on unbudgeted items , except in an emergency.
I know that managing our outflows and inflows, as well as controlling our budget expenditures with our income, will greatly benefit our financial capacities and life as an entirety . However, personally, I feel that it’s one of the most difficult tasks to undertake. It’s not easy, especially if you live in a country where you face numerous unforeseen circumstances, and the money you earn barely covers your needs, let alone your desires.
For example, many of us earn five, six, or even seven-figure incomes, yet we often find ourselves spending almost all of it. This happens because we’re constantly confronted with various challenges in our society, such as inflation, insecurity, an unstable market, economic downturns, and numerous human and environmental factors.
But Just as a farmer diligently tends to different crops in the field to ensure a successful harvest, individuals should nurture their finances through saving and investment. Savings can be likened to the soil, providing security and a foundation for growth, while investments are the seedlings that hold the potential for maximum growth. On the other hand, expenditures act as parasites when not managed properly, affecting both savings and investments.
As financial managers or individuals seeking to navigate today’s economic reality, we must adopt the mindset of a farmer protecting their seeds, taking all necessary measures to prevent parasites from infesting them.