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Make one picture about the comparison in the saving and investment. As much details as you can.

And Write a 200 to 300- word introduction to your remediation. Describe your changes and choices and how they meet the expectations and conventions for the new genre. Include how you think this remediation will instigate change in the audience you’re targeting.

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Jiren Hu 1 Jiren Hu ENG-205 Erica Jones 11/7/2017 Contest in Saving and Investment Saving and investment is an essential concept in the lives of all age groups ranging from students, the young, and also the retirees. Although saving and investing are two terms that most people use interchangeably, they play different roles and have various purposes whereby saving involves restricting personal expenses and keeping the unspent money in custody with the aim of accumulating it. On the other hand, investment consists in purchasing an asset with the purpose of generating returns from it after a period while still taking care of the volatility and risk involved (Webley and Ellen 22). However, both saving and investing are consisting in building wealth as well as finding financial independence in future which is essential to all people regardless of the age. Saving and investing usually have a stated aim which is meeting the unexpected expenses which can range from covering an emergency financial need to maintaining an individual after a sudden job loss or retirement. The concepts of saving and investment have different viewpoints from different age groups. Some people might ask why they are so much pressure in saving and investing. Some argue that one should not worry about saving and investing if they have enough Jiren Hu 2 to cater to their financial needs. However, different people save and invest for various reasons while others have not yet embraced the importance of saving and investing. Considering that the cost of living has gone too high, some people might not have enough to spend and still have some left money that they can save or invest. However, regardless of how the cost of living has risen, the unexpected usually happen at some point of life and thus requiring individuals to look for the savings and investments they have made in their past (Webley and Ellen, 22). When an emergency occurs in life when an individual has not made any saving or investment, most people opt for debts which most of the times are not the best solution due to the interest rate involved while they may also be unavailable according to individual financial history (Zuijderduijn and Tine, 42). This develops the importance of saving and investment in the lifetime of individuals regardless of the difficulties which might be associated with saving and investing. Although saving and investment have uncountable pros, they still have their cons which might hinder some people from saving. This paper will discuss the pros and cons of saving and investment with the aim of persuading students, the young, and the retirees the importance of saving and investment. Saving and investment is an essential milestone in the lives of all age groups in preparing for the future. Pros in Saving and Investment for Students Most students have the mentality that saving and investing is for the older generation, but it is always the best interest of the students to start saving and investing from a young age. A dollar invested today is worth more than a dollar invested in the future, and thus the sooner a person start saving and investing the more significant the benefits. Every successful investor begins at an early age and therefore as a student, one should not think that saving and investing is something that should not be considered right now (Webley and Ellen, 22). This is because the pros in saving and investing for students are vast when one has a plan of what he or she is saving for. The advantages Jiren Hu 3 of saving and investment for students include the opportunity to earn interest on the savings while having little or no risk. Starting saving early when one is still a student also makes an individual learn financial discipline. This is because developing a habit of saving early make one spend less and hence bringing fiscal discipline which is much needed in life. Starting to invest when one is a student is also beneficial in managing the investment risk better because this gives the invested money the extra time needed to mitigate the uncertainty in the market and emerge as a winner. This is because most investments favor those with long investment horizons which can be achieved by starting to save as a student. Furthermore, saving and investing as when one is a student is also beneficial in mitigating risks of life better because when one start saving early, one can make sure that there is adequate financial support in the form of an emergency fund which is vital in countering any emergencies of life (Shetty, 1). Another significant benefit of saving as a student is that the money is protected by the banks’ regulating authorities and thus one does not need to worry about the loss. Investing as a student also creates the opportunity for building wealth over the long term. Furthermore, starting saving as a student also has the benefit of creating the chance of avoiding financial mistakes in later life because one would have learned how to avoid mistakes in financial decisions (Bodie, 88). Therefore, it is not early for the students to start saving and investing because this is the best way to build up the future wealth while still reducing the risk of investing at the wrong time. Pros in Saving and Investment for the Young The young people can be described as individuals between the 25 to 55 years. This is the age group which is actually in the best position to join the investing world even with low salaries and college debts. The pros in saving and investment for the young people are unlimited whereby one of the major advantages for this age group to save and invest is that the fact that they can Jiren Hu 4 afford taking more risk in their activities of investment (McWhinnie, 1). This is because as people move closer to retirement, they tend to run towards risk-free or low-risk investments such as bonds but the young adults can build portfolios which are more aggressive and hence standing to produce more substantial gains. Furthermore, the young adults have the advantage of time, and thus their savings can generate interests which over time can build massive wealth. Considering that the young adults are tech savvy, they can use this advantage to study and apply the online investing techniques and tools when making investments (Subha and Shanmugha, 408). There are countless opportunities offered by the online trading platforms and thus using their knowledge base would contribute significantly to the success of their investments. Another major pro in saving and investment for the young adults is that they end up wasting less money because when individuals are committed to saving, they stick to a budget while still trying to cut out the unnecessary needs and thus increasing the chances of saving more. Furthermore, the young adults have the advantage of finding compatible social circles early because joining the investing world create the opportunity for hanging around with individuals who are financially fit. The young adults also do not require having vast sums of money to invest, but with small amounts and building a saving habit, this will add up over time in the long-term (McWhinnie, 1). For instance, the chart below illustrates the benefits of saving early whereby with as little $50 every month can yield $600 in a year while $100 in a month can yield $1200 after investing in a year. Therefore, investing when one is young places the individuals in a position to watch as their money make more money gradually as illustrated in the chart below. Jiren Hu 5 Another major pro in saving and investment for the young adults is the fact that this forms the cornerstone for building personal retirement plans (Royal London, 1). This is because accomplishing to save for retirement at an early age; this increases the opportunity of attaining financial independence at a younger age significantly. In fact, young individuals have the potential of making a massive impact on their retirement income because they have the advantage of time which the older people don't have. For example, the chart below from JP Morgan indicate that a young adult who invests $5,000 yearly between 25 and 35 years of age can earn $602,070 at the age of 65 calculating the returns at 7 % annually. This illustrates the benefits of saving and investment for the young adults over a more considerable period as shown below (McWhinnie, 1). Jiren Hu 6 The pros in saving and investment for the young adults cannot be limited just for the benefit of their retirements (Shetty, 1). This is because many investments provide income throughout the investment life which creates a major opportunity for the young adults to increase their future wages. Pros in Saving and Investment for the Retirees Most retirees have various sources of income including personal saving and social security. Another major advantage in saving and investment for the young adults is the fact that this forms the cornerstone for building individual retirement plans. For the retirees, it is imperative to make the best use of the retirement benefits for the purpose of keeping the tax liability at bay while still Jiren Hu 7 having a regular source of income. Among the major pros in saving and investment for the retirees include the fact that their health becomes a major priority in the later years. Since the health conditions cannot be guaranteed, it is crucial for the retirees to have savings set aside so that they can meet any medical emergency that might affect them (Bodie, 136). Another pro in saving and investment for the retirees involves the importance of having an emergency fund which can cover various unexpected expenses other than their health needs. Retiring does not imply that the individual ceases to have expenditures because the grandchildren and other family members might require financial help whereby having a savings and investment plan would significantly be essential in meeting such needs (Inker and Martin 128). Furthermore, the retirees also require some extra savings and investments that would support the lifestyle they would like to have because they also need to live well in old age. They occasionally need to treat themselves with a trip away, a meal out, or a celebration with family and friends and thus it is of great importance for them to save even after retirement. The other pro in saving and investing for the retirees is that they need to save for sinking funds which involve the amount set aside to meet future repairs or improvements of their home, car, or other possessions. Therefore, saving and investing for retirees is of great importance in helping this older generation to stop relying on their emergency fund each and every time they have an expense to meet. The cons in saving and investment for students, the young, and the retirees The decision of saving and investing is both a personal and a financial choice, and very often some people may feel like saving is a luxury particularly when they don’t feel like they can afford to save regularly. However, the truth is that all people can afford to save and invest regardless of whatever little amount they can provide, but there are reasons which many people who don’t save or invest give to support their decision. Among the cons that people cited for not Jiren Hu 8 saving or investing is that saving is usually slow and steady while on the other hand, one cannot always predict the gains from an investment (Arvidson et al., 12). This may be true because savings yields low-interest rates, mainly when the amount saved is little while predicting the expected gains from an investment may be hard due to forces such as inflation and unfavorable economic conditions. Although saving is significantly considered safe, the slow growth pace risk the savings being consumed by inflation because when the rate of interest is lower than the inflation rate, the saved money might be lost (Listing, 95). Furthermore, the fluctuations in the value of an investment can be sudden and dramatic but knowing the period of time one intends to invest is essential reducing the risk that might hinder the investment goal. Making investment decisions which would result in a better gain might also be difficult which also hinder some people from investing. Considering that even some professional fund managers might not be able to guarantee their clients the best returns even after costs, this makes many people perceive investing as a complicated and time-consuming task. The withdrawal limitations after saving or investing are also cited as a con in saving and investment whereby those who do not save argue that this is limiting how a person wants to spend the saved money. However, this is not a major concern unless to those who have the habit of covering the unexpected expenses using the savings. It is also essential to refute some of the common reasons why people choose not to invest or save their money (Arvidson et al., 12). Some people might say they have everything they need and thus there is no need for saving which is not a good habit because some people might end up spending money for things which are unnecessary. Living in the moment is another primary reason why people choose not to save particularly the students and the youths, but this is also a major financial mistake because it is critical to saving for the unexpected. Therefore, the cons of saving and investments cannot match the pros and thus, Jiren Hu 9 saving and investment is an essential milestone in the lives of all age groups in preparing for the future. Conclusion After reviewing the pros in saving for students, the young, and the retirees as well as the cons which make people choose not to save or invest, the pros outdo by far the cons which support the thesis that saving and investment are an important milestone in the lives of all age groups in preparing for the future. Every successful investor starts at an early age and thus as a student, one should not think that saving and investing is something that should not be considered right now because this is the time they can develop the saving habit (Lustig, 55). The young people are actually in the best position to join the investing world even with low salaries and college debts because they have the advantage of time which the retirees do have. The pros in saving and investment for the young people are unlimited whereby one of the significant advantages for this age group to save and invest is that the fact that they can afford taking more risk in their activities of investment. Savings and expenditures for the young adults are essential in forming the cornerstone for building personal retirement plans. Although saving and investment might have some cons, the pros are unlimited for all the age groups be they students, the young, or the retirees. Therefore, unless people have vast sums of money, the only way to accumulate wealth is through saving and investment. Thus, saving and investment are an important milestone in the lives of all age groups in preparing for the future. Work Cited Jiren Hu 10 Arvidson, Malin, et al. "Valuing the social? The nature and controversies of measuring social return on investment (SROI)." Voluntary Sector Review 4.1 (2013): 3-18. Bodie, Zvi. Investments. McGraw-Hill, 2013. Inker, Ben, and Martin Tarlie. "Investing for Retirement: The Defined Contribution Challenge." White paper, GMO LLC (2014). Lustig, Yoram. FT Guide to Saving and Investing for Retirement: The definitive handbook to securing your financial future. Pearson UK, 2016. McWhinnie, Eric. “Reasons Young People Should Start Saving for Retirement Now.” August 12, 2016. Web 1. Retrieved from: https://www.cheatsheet.com/money-career/3-big- benefits-of-saving-early-for-retirement.html/?a=viewall Royal London. “The advantages of regular saving and investing.” September 18, 2017. Web 1. Retrieved from:https://www.royallondon.com/financialguidance/guides/savings/the- advantages-of- regular-saving-and-investing/ Webley, Paul, and Ellen K. Nyhus. "Economic socialization, saving and assets in European young adults." Economics of Education Review 33 (2013): 19-30. Shetty, Adhil. “Financial Planning: The importance of saving and investing.” July 20, 2016. Web 1. Retrieved from: http://www.financialexpress.com/industry/banking-finance/financialplanning-importance-saving-investing/323230/ Subha, M. V., and P. Shanmugha Priya. "The Emerging Role of Financial Literacy Financial Planning." Int. J. Innovat. Sci. Eng. Technol 1.5 (2014): 400-408. Zuijderduijn, Jaco, and Tine De Moor. "Spending, saving, or investing? Risk management in sixteenth‐century Dutch households." The Economic History Review 66.1 (2013): 38-56. Jiren Hu 11
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Explanation & Answer

Attached.

Running head: SAVING AND INVESTMENT

Saving and Investment
Name
Institutional Affiliation

1

SAVING AND INVESTMENT

2
Saving and Investment

Comparison in the saving and Investment
Savings

Investment

Aim- Meeting unexpected expenses from

Aim-Meeting unexpected expenses on a

emergency aids to financial aid

larger scale (long term) as compared to
savings

Personal expenses are restricted and unspent

Purchasing assets with the aim of generating

money is kept in custody with the aim of

returns after a certain period.

accumulating it.
Financial independence and building wealth

Financial independence and building wealth

for personal benefits.

for personal benefits and for the benefit of
others

Forms the cornerstone for building personal

Forms a source of i...


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