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Investing
Saving vs. Investing0/3 questions
In this lesson
  1. Introduction
  2. Time and risk
  3. Diversification and fees
  4. Investing under 18
  5. Put it into practice
  6. Check your understanding
  7. Official sources
  8. In short
Investing

Saving, Investing and Growing Money

Understand the difference between saving and investing before risking money.

7 minutesIntermediateReviewed July 23, 2026Lesson 15 of 15
By the end of this lesson, you will be able to…
  • Tell saving and investing apart, and know when each is appropriate.
  • Understand diversification, fees, and investment risk.
  • Know the basic rules for investing under 18.

Saving is usually for money that must remain stable or may be needed soon. Investing involves uncertainty in exchange for possible long-term growth.

Key takeaway

Saving prioritizes safety and access; investing accepts risk for possible long-term growth.

Time and risk

Investments may rise or fall.

Money needed soon should not normally depend on a risky investment increasing at the right time.

No investment return is guaranteed.

Diversification and fees

Diversification spreads money across investments but cannot eliminate loss.

Fees reduce returns.

Past performance does not guarantee future results.

Avoid guaranteed high-return or risk-free claims.

Canada-specific

Investing under 18

A Canadian resident generally must be at least 18 with a valid SIN to open a TFSA.

In provinces where the contract age is 19, the person may need to wait until 19 to open it, while contribution room from age 18 may carry forward.

Do not misrepresent your age or use someone else's identity.

Key terms in this lesson
Diversification

Spreading money across investments to reduce — not eliminate — risk.

TFSA

A registered account that generally requires being 18 with a valid SIN to open.

Quick check

True or false: diversification removes all investment risk.

Put it into practice

0/5 done
  1. Ask: When will I need the money?
  2. Ask: Could I accept a loss?
  3. Ask: Do I understand the investment and its fees?
  4. Confirm the provider is regulated.
  5. Make sure you have short-term savings first.
Check your understanding

3 questions

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Questions completed: 0 of 3

Question 1 of 3
What is the key difference between saving and investing?
Question 2 of 3
Someone online promises guaranteed daily returns if you send money now. What is the correct read?
Question 3 of 3
What should generally come before investing?

In short

  • Saving prioritizes safety and access; investing accepts risk for possible long-term growth.
  • Diversification spreads risk but cannot eliminate the possibility of loss.
  • Fees reduce returns, and no investment return is guaranteed.
  • A working budget and a small emergency fund should generally come before investing.
Educational content only. TaxLoophole.ca provides general educational information and does not provide personalized tax, legal or financial advice. Rules may change and may differ based on your province, territory and circumstances. Verify important decisions with the Canada Revenue Agency, another appropriate government source or a qualified professional.

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