When it is all said and done, there are only two kinds of investments — long-term and short-term.
Long-term investments should be money that you are not going to touch for more than 5 years. This category involves retirement planning and overall wealth building. This money does not need to be as liquid as short-term investments, meaning you can put the money in real estate or a start-up business.
Short-term investments should be money that you need to be more accessible and readily available for you to use at short-term notice. Short-term investments should be savings for things that are less than 5 years down the road. This might include saving for a car, a down payment on a house, car/house maintenance, or other high dollar personal items.