Business CW Topic: Savings VS Investments

G11 Date 26/02/24

Students’ names Reem Mohamed / Masa Yasser.

A. Study Class Materials Week 23 Day 1

B. Answer the following questions

Individual Work:
1. What is the meaning of the “Liquidity”?
Liquidity refers to the ease with which an asset can be converted into cash without affecting its
market price/ value.
2. Define Savings.
Savings refer to the money you set aside from your income and don't spend right away. It's the
portion of your earnings that remains after you've paid for your expenses (has the same value)
3. Explain the main purposes of Savings.
Financial security: Savings provide a safety net for unexpected expenses and emergencies
Achieving goals: Savings allow you to plan for and achieve your financial goals
4. Explain why savings plans are important to savers/investors, what are benefits of buying a savings plan.
Savings plans promote discipline, growth, flexibility, and security, enabling individuals to build
wealth, achieve financial security, and achieve long-term goals through regular commitment.
5. List the most common Saving Plans all over the World (top 10).
1. Regular Savings Accounts
2. High-Yield Savings Accounts
3. Certificates of Deposit (CDs)
4. Retirement Accounts
5. Health Savings Accounts (HSAs)
6. Money Market Accounts
7. Savings with Automatic Transfers
8. Micro-savings Accounts
9. Roth Accounts
10. Micro-savings Accounts
6. Define Investments.
Investments are assets acquired with the expectation of generating future income or growth
7. Explain the main purposes of Investment.
Grow wealth over time: Investing can help your money grow at a potentially faster rate than
saving alone.
generate income: Some investments, like stocks and bonds, can provide income through regular
payments
8. List the most common Investment Plans all over the World (top 10).
1) Stocks
2) Bonds
3) Mutual Funds
4) Exchange-Traded Funds (ETFs)
5) Real Estate Investment Trusts (REITs)
6) Savings Accounts
7) Certificates of Deposit (CDs)
8) Robo-advisors
9) Annuities
10) Commodities
9. Explain factors should be considered when making investing decisions.
  Financial Goals
 Risk Tolerance
 Time Horizon
 Diversification
 Market Conditions
 Costs and Fees
 Investment Research
 Liquidity
 Tax Implications
 Personal Financial Situation
10. What is the main difference between Savings and Investment Plans in your opinion?
Investment plans attempt to increase your money over a longer period of time but carry greater
risk than savings plans, which are safer for storing money you might need shortly.

Pair Work:
11. Complete the comparison Table What are differences and Similarities in Saving and Investment Plans
(Be ready to present your analysis in front of the class)?

N Plans How these plans work for… Similarities Differences

names Saving Investment
1 Low risk, Guaranteed
returns (except for Low potential
Savings Deposit money, money market returns, Not suitable
N/A
Accounts earn interest accounts), Easy access for long-term wealth
to funds (except for building
CDs)
2 Low potential
returns, Not suitable
Certificates Automated Guaranteed returns
for long-term wealth
of Deposit N/A investment (except for money
building, Limited
(CDs) management market accounts)
access to funds
during the term
3 Low potential
Money
Deposit money, Low risk, Easy access returns, Not suitable
Market N/A
earn interest to funds for long-term wealth
Accounts
building
4 Higher risk,
Potential for capital
Owning shares of appreciation and
Stocks N/A ownership in May offer tax benefits dividend income,
companies Not guaranteed
returns, Subject to
market fluctuations
5 Lower risk than
Loaning money to stocks, Lower
governments or May offer tax benefits, potential returns
Bonds N/A companies in Guaranteed returns (if than stocks, Subject
exchange for held to maturity) to market
interest payments fluctuations,
Interest rate risk
6 Mutual N/A Professionally Diversification, May Fees, Not
Funds managed portfolios offer tax benefits, guaranteed returns,
of various Professional Subject to market
 investments management fluctuations
7 Similar to mutual
Diversification, Lower Not guaranteed
funds, but traded
ETFs N/A fees than mutual funds, returns, Subject to
on stock exchanges
Traded like stocks market fluctuations
throughout the day
8 May offer tax benefits,
Invest in income- Subject to market
Potential for dividend
REITs N/A producing real fluctuations,
income and capital
estate Management fees
appreciation
9 Low risk, Guaranteed
returns (except for Low potential
Savings Deposit money, money market returns, Not suitable
N/A
Accounts earn interest accounts), Easy access for long-term wealth
to funds (except for building
CDs)
10 Low potential
returns, Not suitable
Certificates Automated Guaranteed returns
for long-term wealth
of Deposit N/A investment (except for money
building, Limited
(CDs) management market accounts)
access to funds
during the term