I often hear people tell me they’re “good with money” because they put something aside each month. They mean they’re saving.

While that discipline matters, saving alone will not deliver long-term financial security or freedom. In today’s economic reality, relying only on savings could be the biggest financial mistake of your life.

The U.S. personal saving rate was just 4.5% of disposable income as of June 2025—less than half the long-term average of 8.4% and far from the double-digit levels common in the 1960s and 1970s.

Almost three-quarters of Americans—73%—are saving less for emergencies than they were a year ago, with only 55% saying they could cover three months of expenses.

These figures should concern anyone who cares about financial resilience. Even if you are among the disciplined few who save consistently, inflation and low interest rates will steadily erode the purchasing power of your money.

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Most savings accounts today yield less than inflation. That means every dollar in a low-yield account is shrinking in value over time.

People often describe this as “playing it safe,” but the reality is that they are losing ground. You can save for decades and still arrive at retirement with far less purchasing power than you expected.

Too many people also miss out entirely on the markets where wealth is created. Only 62% of Americans own stocks, leaving 38% completely outside decades of compounded market growth.

Among lower-income households, just 10% invest in equities, and with those without a high school diploma, participation drops to 5%.

This has consequences. When a large segment of the population doesn’t invest, they miss the most reliable long-term path to wealth accumulation. The wealthiest 1% now hold 50% of all U.S. stock market wealth. This isn’t simply a story of luck; it’s the result of ownership.

I understand why many avoid investing. Markets can seem complex and unpredictable. But avoiding them altogether is like refusing to take the only route to your destination because you worry about possible delays.

Yes, there will be market swings and downturns, but over long periods, equity markets have consistently delivered returns that beat inflation, savings account interest, and most other asset classes.

The problem is often perception. Many people think of saving as the “responsible” choice and investing as “risky.” Both have risks. The difference is that the risk of not investing is certain: your money will not grow enough to keep pace with rising costs in housing, healthcare, and everyday living.

Right now, the average American estimates they will need $1.6 million to retire comfortably for about 22 years. With a saving rate of 4.5% of income in a low-yield account, that target is unrealistic for most. This is not an opinion, it’s mathematics.

Even institutional investors, who in recent months have reduced US equity exposure due to short-term concerns, continue to hold substantial positions in equities worldwide. They may shift between regions, but they keep capital in growth assets because they understand that these are essential for building long-term returns.

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For individuals, the answer is to combine saving and investing. Savings protect you in the short term. Investments build your wealth in the long term.

The earlier you start, the more time you give your money to grow. Diversifying across asset classes, sectors, and geographies reduces risk and improves the odds of achieving your goals.

Waiting for the “right time” is one of the most common mistakes. Markets will always move up and down. There’s no flawless entry point.

The most effective approach is steady, disciplined investing over years and decades. That is how compounding delivers results. A dollar invested today has far more potential than a dollar invested 10 years from now.

This requires knowledge and discipline. Either learn the basics yourself or work with someone who can guide you. Avoid chasing the latest hot trend or trying to time the market. Long-term investing rewards patience and consistency.

Financial freedom comes from owning assets that generate growth. Keeping all your money in cash guarantees that your wealth will be chipped away by inflation. Delaying investment decisions makes the problem worse. The shift from “I save” to “I invest” is not a luxury, it’s a necessity.

For most people, investing is the only realistic path to a retirement with dignity, the ability to make choices, and the means to support the next generation. Saving is important, but it is only the foundation.

The structure that delivers long-term security and freedom is built by putting your money to work.

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London-born Nigel Green is founder and CEO of deVere Group. Following in his father’s footstep, he entered the financial services industry as a young adult. After working in the sector for 15 years in London, he subsequently spent several years operating within the international space, before launching deVere in 2002 with a single office in Hong Kong. Today, deVere is one of the world’s largest independent financial advisory organizations, doing business in 100 countries and with more than $12bn under advisement. It specializes global financial solutions to international, local mass affluent, and high-net-worth clients. In early 2017, it was announced that deVere would launch its own private bank. In addition, deVere also confirmed it has received its own investment banking license.