Money That Come Unexpected
Whether you finally landed that big client or you finally won the lottery, an influx of surprise cash is always a good thing. And it also requires some planning. Here are my thoughts on the best ways to allocate that extra money, in order. Money That Come Unexpected:
Put the majority of the windfall towards your biggest financial goal
A windfall is a great way to fast forward yourself towards a big financial goal. Whether you’re working on paying off debt, saving up for a down payment, or budgeting for a round-the-world trip, use your extra cash as a shortcut.
If you don’t have any financial goals right now, set some of the windfall aside—in a savings account, a money market account, or a brokerage account—so you’ll have that extra financial padding when you need it.
Put another chunk of the money into savings and/or investments
See above. (Also, I totally recommend investing even if you are anxious about market fluctuations. Money That Come Unexpected )
Spend a small percentage of the money on something fun
Putting all of your extra money towards your student loans might be the most financially prudent thing to do, but if you drop your entire windfall into a pit of debt it can leave you feeling… well… kinda like you stood on the edge of a pit and watched a bunch of opportunities drift away from you.
Spend at least some of the money on someone else
Whether you’re making a charitable donation, supporting your local library, or taking your parents out to dinner, make sure you spend some of that money on someone who isn’t you. Chances are, a lot of people helped you get to where you are today. Now that you have some extra cash, it’s time to pay it back—and pay it forward.
Consider buying more time
Remember that study from a few years ago that suggested the best way to turn money into happiness was to buy back your time? Consider using some of your windfall to outsource your least favourite time-suck, whether it’s food shopping, housecleaning, or doing your own laundry.
Or, if your windfall is large enough, use it to move to a house or flat that’s closer to the places you usually go (or the places you’d go more often if it didn’t take so long to drive there). Commutes are often the worst time-sucks of all, so see if you can use your extra cash to reduce or eliminate them.
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