Finance What Is The Difference Between Investing And Financing?

[Good-Guy]

Finance and asset is one of the most important aspect of business. However, finance is a very vast term and it has many aspects. Finance could refer to the capital you have in your possession and you can use it in order to invest more into business. Financing is one of the most important pillar of business and this is why many people have held a concept that finance is itself a branch of commerce. When it comes to investment, many people think that finance is quite similar to investing. However, many people think that there is a slight difference between the two and this has confused me a lot. So, is financing the same as investing? Do you believe that both of them are different?

 

[Suba]

In a narrow sense, finance is often defined as money, but in a broad sense, finance is a term related to management and business science, financial management, financial analysis, financial statements, budgets, behavioral finance, etc., and often studies about money and investment. For the government, finance is often interpreted as monetary policy, taxes, economic stability, government debt, budget, etc. For a financial company, it means the management and control of assets and liabilities as well as revenues, costs and debts. Individually money is defined as income and expenditure, planning and control, insurance, investment, savings and pension funds.

 

[Jasmine]

In broader term, finance and investment both are similar. For example, you finance a business or invest in a business both means more or less same. But if you analyze minutely, there is a difference. When you invest, you do not manage the business, however, financing also financial management where you will manage your funds.

 

[Good luck]

Financing is another way of spending,you can you can be financing a project and work can take a long period of time which may be one or two years while you keep spending your moto make sure you have a better at the end while you invest your capital to get a good return with good interest at the end.

 

[btaliat]

It depends on the usage. But most time, when people use financing, they mean spending money on a particular project which is expected to bring reward at the moment. But while you are investing, you are looking at the future. Investment thus take longer time when compare with financing in a narrow sense.

 

[MoneyCube]

It doesn’t matter how much or how little money you have, it’s always a good idea to invest as much as you are able to. If you start investing in your 20s, you can invest as little as a few thousand dollars a year and you will still be well on your way to preparing for retirement. It may sound like a lot, but $3,000 over the course of the year is just $250 per month – as an example.
A good practice is to set aside a portion of every paycheck to invest, after taking out what you need to live such as housing expenses and food. When you establish this habit early, you will have more money to invest both now and in the future, and you will be ready to invest with the time is right.

 

[Good-Guy]

I agree with the definition provided by Suba. Finance is actually a much broader term and we can say that "investing" is actually a branch of finance that involves using finance in order to make money or increase finance. Usually the term "finance" involves everything related to commercial activity that involves fund.

 

[Mandy96]

I am not trying dispute what you just wrote in the post above but as for me, investing is very similar to financing when it comes to business purpose. But if we are talking about general definition, investing simply means to put your money on something that you know you are surely get getting a profitable outcome from it, while financing simply means to pump in money to a certain thing, it is not purposefully because of the profit or gain that we are going to get from it but because you have to. For example, you can fund an NGO program, we all know you wouldn’t be expecting any income from it in the future

 

[Mataracy]

To investment is very different from finance in the sense that:
Investment can described as a way in which one gather some money to invest on a business in other to yield more profit or returns at the end of certain period of time.

Finance in the other hand said to be a way through which one manage the business or investment in order to yield more profit than expenses.
It said to be away through which one manage the inflow and out flow of income in a business.

 

[btaliat]

The interlocking aspect between the two terms come as a result of the fact that one needs to invest most time to finance a particular project.

 

[Yusra3]

Investing and lending are individual forms of financial management. Investing, in its broad sense, is the process of using funds for the purpose of buying assets with a view of obtaining a profit by the way of return over a given period of financial time. It carries the risk of losses which the trader could be liable for or costs which the trader could incur. Financing deals with borrowing money or getting debt, or source it through loans or credit, etc. and selling the equity/ownership rights(?) for meeting out the requirements and business operations. In contrast to the investing mechanism, which is based on personal fund use, financing implies looking for outside sources of capital that should be paid back to the lenders, with borrowers’ interest payments.