When you get a sum of money that you either weren’t expecting it can be easy to just spend it on whatever you want.
But you are smart about how you spend it, it can improve your financial situation and your financial future.
Here are 10 smart ways you can get head with your lump sum:
1. Pay off debt
If you have any debt, put as much of the windfall towards the debt as you can. The quicker it is gone the less interest you pay and the more money you free up each pay day to save.
2. Upgrade to energy/water saving appliances
If your appliances are in need of replacing, look for the most energy efficient and water saving options within your budget. They will save you money long term.
3. Bulk buy
Some items are significantly cheaper if bought in bulk. Be sure to only buy what you will use so nothing goes to waste. Good items are non perishable such as bulk washing powder, toilet paper, soap. If you see or know of a great sale or discount, use some of the money towards stocking up.
4. Invest it
There are a variety of ways to invest your money and what you feel comfortable investing is up to you. Some options are shares or property, term deposits or if you are a collector or have great knowledge about items you could look at comics, coins or other collectables.
5. Buy to resell
You need to know what resells well, but if you have the time you could go to garage sales, second hand shops and so on, buying items to resell on eBay, GumTree or even Facebook.
Get dental work done. If you haven’t had a check up in a while, get one. If you need your wisdom teeth out, get them out. How does this save money? Dental health affects the rest of our health and if left unchecked can lead to serious health problems. Serious health problems are expensive. Plus the longer you leave your dental check up or dental issues, the worse and more expensive it will be.
If you don’t have private health insurance, now would be a good time to get it. Even basic cover for ambulance and hospital can be a great money saver. If you don’t have free medical in your area, you could also put some of the windfall towards a full check up including blood tests to check your overall health.
Donate some of the money to your favourite charity. It is a tax deduction for you and while you won’t get all of it back, it is still worth while doing.
Put it into your superannuation. Depending on your income level you may be eligible for the Governments co contribution. Even if you are not, the sooner you put money into your superannuation, the faster it can grow. Another bonus is the tax advantages of adding extra money to your superannuation.
A holiday might not seem like a money saving option, but the chance to distress and unwind might be just what you need. When you are more relaxed you can focus better and are more likely to manage your finances better.
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