Should you save or invest for the future?

It’s not always obvious or clear what you should do with money. Choosing whether to save or invest can be difficult. However, it is possible to come to a firm decision once you know what your options and priorities actually are.

Pros and cons

Basically, saving money and investing money each have their own pros and cons.


Saving is more secure, yet it may not always provide the most gain.


Investing in stocks and shares gives you the potential for higher growth, but it comes with higher risk.

Choosing between these options depends largely on two things. First, how much you want your money grow. Secondly, how much risk are you willing to take for the potential for higher growth.


  • Putting your money in a savings account with a bank is usually a safe option.
  • Your money isn’t used to buy shares that may drop in value - it earns you interest each year.
  • Interest rates have generally been low and sometimes can be less than the rate of inflation. This could mean that the amount of interest you earn is not enough to cover inflation so your spending power is reduced.


  • Investing in stocks and shares provides the potential for higher growth.
  • It comes with some risk as the price of stocks and shares can vary so investing is usually for the medium to longer term to benefit from potential growth.
  • Be flexible about when you need your money back to reduce any risk.
  • Historically, stocks and shares have provided higher growth than accounts paying interest.


People aged 18 and older can save with ISAs (Individual Savings Account). There are different kinds of ISAs available, each offering a different way of saving or investing your money.

Here are three of them:

Cash ISAs

Let you save up to £20,000 a year without having to pay tax on any interest earned.

Stocks and shares ISAs

Let you invest in stocks and shares without having to pay tax on the investment growth.

Lifetime ISAs

Give you a 25% government bonus on top of what you pay in yourself each year.

ISAs present you with a choice between saving and investing. Your preference will depend on your aims and attitude to risk.

Stocks and shares ISAs come with a wide choice of investment fund options, the one of the key differences between funds will be the risk profile. These funds will put your money in different types of investments – typically this will be a combination of more risky company shares, and less risky fixed interest investments (like cash, Corporate Bonds and Government Bonds (also known as Gilts)). The risk of the fund will depend on the balance between these investments – for example, a fund that invests 75% of you money in fixed interest, and 25% in company shares, will be less risky than one that invests 100% of your money in company shares.

Typically the more risk you take, the higher the potential growth on your money, but there are no guarantees. There will be ups and downs along the way, and the performance of your investment is influenced by timing - when you invest, and when you withdraw.

Cash vs. stocks & shares

Find out the difference between saving your Child Trust Fund money in cash or investing it in stocks and shares.

Video transcript 

Cash vs. Stocks & Shares

While you’ve been growing up, the money in your Child Trust Fund has been growing too, and we want to keep it working hard for you. The question is, how can you do that?

First of all, it depends on whether you're looking at a long-term investment or saving up for something in the short term.

Let's say you're about to turn 18. You might want to go away with your mates after exams
or need to buy stuff for university, college or school. For those expenses you want to have instant access to your money, which makes a cash savings account a really good option.

But it can be a challenge to earn much interest from your savings these days, with interest rates so low. And your savings could lose value if inflation - the increase in price of stuff you might want to buy with your money - is higher than your interest rate.

If, on the other hand, you want to save for something further into your future - you don't have to know exactly what that is right now - this is definitely more of a long-term investment. This might make investing in stocks and shares a better option as investing could give you a much better return in the long run. But it can be riskier as the value of stocks and shares can go down as well as up.

So, cash or investment? The choice is yours, but either way it's good to make your money work harder for you.

At OneFamily we invest in stocks and shares as we believe they have good potential for growth over the longer term and with a choice of risk profiles you can be as cautious or as adventurous as you like.

The choice is yours...

In the end, there’s no right or wrong answer when it comes to choosing between saving and investing. Nonetheless, it always pays to do your research, to understand your options, and to know what you want.

Think carefully

Your Child Trust Fund has been invested for a long time. It’s important to think carefully about how to spend, save or invest it.

Whatever you decide to do with your Child Trust Fund it’s a good idea to speak with your parents, guardians or other trusted adults about it. We have a range of investment products that can help you keep your money invested for the future, whatever your goals may be.


Simon Chandler is a journalist who writes for Forbes, International Business Times and more. Follow him at