Investment management: Why Saving Won’t Make You Rich Anymore

According to the Before the Fall report released this month by The Resolution Foundation ‘Britain’s huge wealth gaps mean a typical worker would need to save more than a lifetime’s worth of their earnings to become wealthy.’

To put it more starkly, in the unlikely scenario that a typical full-time employee was able to save 100% of their earnings over a 52-year career, they would still not be able to reach the top of the wealth ladder.

‘Look after the pennies and the pounds will look after themselves’ may have been sound advice in the past, but today, it’s the assets you own – not the coins you collect – that truly determine financial security.

The report highlights a widening divide between those who save and those who invest. Over the past decade, property and pension values have soared, while wages have largely stagnated. As a result, households that already own assets have seen their wealth multiply, while those relying solely on savings accounts have struggled to keep pace.

This marks a fundamental change in how wealth is created. The financial system increasingly rewards ownership of assets – such as shares, property, and funds – rather than accumulation of cash. Inflation and rising living costs continue to erode the real value of money left in savings, meaning that even the most disciplined savers risk falling behind.

Investment allows individuals to benefit from compounding returns – where gains generate further gains over time. This effect is the true engine of wealth creation. A well-diversified portfolio, managed sensibly and over the long term, can capture the growth of markets that simple saving cannot.

The challenge, however, is psychological. Many people still associate saving with safety and investing with risk. Yet in today’s high-cost, low-interest world, keeping your money in bank deposits believing it to be risk-free could cost you dearly as its value is quietly eroded by inflation, the silent thief.

Much public debate centres on wealth inequality and taxation, but as individuals we have little influence over those forces. Instead, we must take control where we can.

The message is clear: to build lasting financial security, it is no longer enough to preserve capital – it must be grown. That means starting early, investing consistently, and taking advantage of the compounding effects that drive wealth creation over time. Waiting until you “have enough to invest” often results in being permanently left behind.

The era when hard work and steady saving could reliably build prosperity has passed. In today’s economy, financial success depends on ownership of assets, not just effort. This doesn’t mean abandoning saving altogether, but rather recognising its limits. Savings provide stability and liquidity, but investing provides opportunity and growth.

If you’re ready to make your money work for you through thoughtful investing, it’s time to take action. Contact us today to speak with one of our professional financial planners about an investment strategy suited to your goals, risk appetite, and stage of life.

By building a balanced portfolio with diversified assets, we can help you safeguard your long-term financial wellbeing and build genuine wealth for the future.