Investing is a productive use of cash. Cash is a token that represents the goods produced to earn it. You can redeem it for goods, or lend it to someone if they

Investing is a productive use of cash. Cash is a token that represents the goods produced to earn it. You can redeem it for goods, or lend it to someone if they can make better use of it. If they can make better use of it now, you make a deal that they'll give you more of these tokens later. If you hold onto cash, it does nothing. If you invest it, either directly, or by giving it to another entity to invest on your behalf (IE, a chequeing account at a bank or mutual fund), it allows someone else to make use of it, and in exchange, you will be repaid with more cash in the future.