Saving accounts are designed so the customer can put aside their money to allow it to build up in interest or for another time. Some savings accounts charge for withdrawals which further makes it easier for the customer not to use that money. You can get online only savings accounts which usually have higher interest rates and carry higher security restrictions.
Savings are essentially concerned with capital preservation and easy access (if you choose). Savings accounts include cash ISA where you can ‘buy’ one for a period of time. Most of these require a minimum start amount and have limits or restrictions when it comes to withdrawals and payments in.
Investments are designed so that you should gain a higher amount of money over time, than to what you originally put in. You can invest in stocks, bonds, mutual funds and/or certificates of deposits. Many people invest in stocks after doing their own research, but banks can supply advice and suggestions as to what will (hopefully) make money. Investments are used to take profits and dividends. They are usually longer term than savings accounts.
Investing is similar to gambling, in that there is always the risk of losing money. If you are choosing your investments yourself, make sure to research fully into what you are investing in. Other types of investment products available within banks include shares where you buy a share in a company.
Pooled or Collective investments are where small contributions from several people are used to amount to a single investment fund. These include Authorised Unit Trusts, Open Ended Investment Companies, Investment Trusts and Exchange Trade Funds.
Seek advice from your local banks before dedicating yourself to any of these accounts of investments.