3 Things to Do with Your Money after a Windfall
Sometimes it can seem like no matter what we do, there just isn’t enough money to cover our basic needs and wants, try as we might. At other times, however, we find ourselves in the enviable position of experiencing a windfall and having a good chunk of change at hand to do with as we please.
All too often, the immediate response to this kind of situation is to go on a shopping or partying spree until all of the cash is gone and we barely remember what it was like to have had it in the first place.
In his autobiographical work “John Barleycorn”, famous author Jack London recounts a story of men he sailed with who, en route back to the US after a time at sea, were all waxing lyrical about what they would use their pay on. Several planned to return to their home countries and settle down. Others planned to take up dancing lessons, or start businesses. Long story short, all of them spent all their money on a week-long bender and had nothing to show for it afterwards.
To avoid that fate, it helps to have some bigger-picture ideas of what to do with your extra money. Here are some thoughts.
Invest it
In today’s world, it’s a relatively straightforward matter to identify a marketplace for algorithmic trading strategies, or to brush up on the basics of investing in property.
Financial investment is something that a lot of people associate solely with those who are already major financial hard-hitters, but getting started early in joining the property market, or playing the stock market, can make all the difference.
Bodybuilding, actor, and politician Arnold Schwarzenegger famously became a millionaire before ever becoming an actor, in large part due to his investments in property during his Mr Olympia days.
Stash it in a savings account
Putting your excess money into a savings account and just letting it sit for a while may seem a bit pointless to some, but it’s often one of the better financial ideas that people have.
For one thing, following this strategy means that you’ll begin earning interest on your money (even if not much). It also means that you’ll be training yourself in the art of deferred gratification, and saving up a nest egg.
While you may not know exactly what to do with the money at this particular point in time, after a year or two of saving, you’ll find yourself with a large chunk of change and a good many opportunities ready for the taking.
Budget it for longer-term goals and projects
Using as a zero-based budgeting approach to money, and assigning every dollar of yours a “job” is a great way to save yourself from the temptation to spend recklessly.
Budgeting your money for longer-term goals and projects is a fantastic way of working incrementally towards things which you would otherwise struggle immensely to attain.
You might think you could never afford that car of your dreams outright. But if you started putting aside a decent amount of money each month, starting now, you might be amazed what you could achieve over time.
