10 ways to use extra money

Having some extra money on hand, whether it’s due to a generous bonus, a larger-than-anticipated tax return, or an unexpected inheritance, can open the door to new financial possibilities. Although the temptation is surely there to spend it on something extravagant, it’s also a great opportunity to put some careful thought and planning into how you can make the most of these extra dollars. Read on for 10 suggestions from us on how to maximize your windfall.

Decrease debt

If you have accumulated any high-interest credit card debt, you’ll want to tackle that first. If it doesn’t seem like a very fun use of found money, look at it as the first step in gaining control of your financial destiny. And if you seem to carry a perpetual balance and you still have windfall funds leftover, consider using them to rebalance your budget, so you can comfortably pay off your card each month.

Fortify your emergency fund

Strengthen your financial foundation by beefing up your emergency fund to ensure you’re sufficiently shielded against life’s unexpected curveballs. If you don’t yet have an emergency fund, building one is essential — perhaps you’ll want to hold back a portion of your debt payoff funds if that’s where you’re starting. Having a financial safety net can provide peace of mind and protect you from unexpected expenses.

Seek out a CD special

Certificates of deposit (CDs) can be a savvy choice for those seeking a secure and predictable return on their money. By locking in a fixed interest rate for a specified time frame (typically ranging from a few months to several years), you can capitalize on higher interest rates. It’s a safe, easy, attractive way to generate some green, and your future self will thank you.

Invest wisely

Let your money work for you by exploring investment opportunities based on your financial goals and risk tolerance. This might include a mix of assets such as stocks, bonds, or mutual funds. It’s a good idea to check in with an investment professional to ensure you’re starting out with the right amount of risk and a diversified investment portfolio. If you’re unfamiliar with investing and really just want to dip your toes in, our Online Investing* offering might be a great place to start.

Retire with gusto

Contributing a chunk of your excess cash to max out retirement accounts now can significantly impact your financial security in the long term, and it may help offset your taxes (but be sure to consult a qualified tax professional for guidance on your unique situation). This is a great time to open an individual retirement account (IRA) — every dollar saved now is a step toward a more comfortable and secure retirement, so catch up now, and consider increasing your contributions/retirement savings with each wage increase you receive.

Upgrade your space

Whether it’s a sleek kitchen upgrade or energy-efficient enhancements, investing in your home sweet home can enhance the value of your property while increasing personal satisfaction in your dwelling. In the case of energy-efficient upgrades — even in the form of appliances — you’re reducing long-term costs, as well. Not a homeowner? Maybe this chunk of change goes into your saving-for-a-home fund.

Catch up on car maintenance

There is no time like the present to be sure your vehicle has had an oil change, all its necessary maintenance, and that your tires and battery are good to go. If your ride has honestly seen better days, maybe your bonus cash goes toward a down payment on a shiny new(er) model.

Learn and earn

Invest in yourself by furthering your education or acquiring new skills. This could increase your earning potential and range of employment opportunities. Regardless, it’s the ultimate long-term investment with a guaranteed ROI: self-improvement and increased confidence.

Give back

Spread the joy by allocating some of your “found” funds to tithing or other charitable causes. By making donations to causes that align with your values, you’re making a positive impact beyond your immediate circle while supporting organizations whose missions you believe in.

Hit the road

Have all the boxes checked on your “do the responsible thing with my money” list and the travel bug is biting? Sounds like investing in life-enriching, memory-making travel experiences may be your choice for spending your pennies from heaven. Enjoy, and send us a postcard! Not so much into travel but have your eye on skydiving lessons, an upscale accessory, or another splurge? Financial freedom means having the ability to choose, so be our guest.

Found money is an opportunity waiting to be seized. It’s not just about spending; it’s about strategically allocating resources to enhance your overall financial picture — both present and future. Give it some careful consideration, and we know you’ll make the best money move for your situation. Questions? Your friends at UBT are here to help.