Savings is done by the consumers, whereas investments are made by entrepreneurs. Savings is inevitable for capital formation and economic growth. The portion of income not spend on consumption is called savings. Whereas investment means addition to the existing production capacities, such as buying of plant and machinery. Both savings and investments are interlinked.

Such activities help to generate wealth in economy, through employment and thus both consumers’ who create demand for goods and services and the entrepreneurs who fulfill this demand are performing activities to develop the economy.