Invest has multiple legal meanings. Generally, in contract law, it means to put money in a certain manner so that it will generate revenue, such as investing money into a business, property, securities, a house, stocks, etc. with the purpose of generating income and obtaining a profit.
To invest is markedly different from a monetary gift or a loan in that a gift is intended to benefit and accommodate the recipient without any income or profit in return. A loan is a monetary amount that is expected to be paid back, generally with interest.
The word invest, which is generally seen in legal issues involving financial matters, is derived from the Latin word root word of investire, which simply means to clothe or adorn and is used interchangeably with the word enfeoff in the system of jurisprudence. Enfeoff was part of the European feudal system in the middle ages and was when an individual was given land in exchange for pledged service. Both enfeoff and invest signified to put a person in possession of land upon taking an oath of fealty to their lord.
[Last updated in June of 2020 by the Wex Definitions Team]
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