[disneysteve]

Originally Posted by tmvijai

I don't really agree that saving is investing. You can say theoritically but doesn't make practical sense. Saving is basically about trying to keep your money safe or preserve your capital with added advantage of interest to beat inflation if possible. THere is no risk involved in it.

This is all academic, of course, but you actually make a good point. An investment is something you do with the expectation of profit. That's exactly why I always say a house is not an investment. I didn't buy my house in order to make a profit. I bought it to have a place to live.

By the same logic, a savings account paying 1% before taxes really isn't an investment either. I don't put money in an account like that with the expectation of profit. I put it there for it to be safe and readily available as needed. For that matter, I put money in my checking account regularly and that pays no interest at all, so that is savings but certainly isn't an investment.

ETA: I forgot to address the last sentence I quoted. There is absolutely risk associated with a savings account. There is inflation risk, the risk that your money will fail to keep pace with inflation and thus give you a negative return in real dollars.