What to do with cash right now?
Now is the time to be thinking about how best to use your cash. You may have a little or a lot, but it’s important to make the most of it either way.
So, what are some things you can do with your cash right now? Read on to find out!
Table of Contents
Clarify your short and long terms needs and goals.
Before you do anything with your cash, figure out what you’re saving it for. Are you planning to use it for a big purchase in the near future? Is there an investment that is just about ready to pay off? Are you putting money aside so that you’ll actually be able to afford to when you retire? Knowing where your cash is going will make it easier to invest and spend it.
A clear GAME plan is the number one way to make the most of your extra cash right now.
Having a plan in place will help you prioritise the most important things to you and avoid distractions along the way.
Remember, the purpose of your money is to help you lead a great life, achieve great things now and later and not just collect more stuff.
If you can manage your money well, you can be kind to yourself now and later.
Use your cash for investing in yourself or someone you care about.
You can also invest your cash in yourself or someone you care about.
Perhaps you’d like to use some of it to learn a new skill, such as blogging, developing websites, or repairing items that everyone uses.
You could use the cash to improve your skills or qualifications to get a pay rise. And you could use your spare cash to start a side hustle to create a business asset. Maybe hiring a coach could help you build that business you have always wanted!
Or maybe you’d rather give the cash to someone who could really use it-like a broke college student or a family member who is struggling financially. Investing cash in yourself or someone else can pay off big time!
Get rid of debt and improve your credit score
Now that you’re investing your cash in the smartest way possible, it’s time to start getting rid of debt. If you owe money on any high-interest credit cards or loans, now is the time to pay them off and improve your credit score. This will help to ensure that you have even more cash in the future!
You can use the snowball method of prioritising your debts. The snowball method is an incredibly effective way to prioritise your debt.
Here’s how it works: make a list of all of your debts from the smallest to the largest, then start paying them off from smallest to largest without looking at any interest rates or minimum payments. Once you’ve paid off the first one, turn your attention to the second smallest debt and so on until you’ve paid them all off. You’ll feel a lot of satisfaction knowing that you’re getting rid of your debts one by one!
There is another method for prioritising your debts that you may also want to consider- the avalanche method. With the avalanche method, you start with your biggest debt and aim to pay it off first. Then, turn your attention to the second-largest debt and so on until all of your debts have been paid in full.
Both strategies can help you to be debt-free faster, but it’s up to you which one makes more sense for your situation.
Start investing in the great companies of the world.
Start investing in the world’s great companies through low-cost, globally diversified index trackers.
It’s important to invest your cash because it has the potential to grow and provide you with financial security over time. When you invest in a company, you’re essentially becoming a part of that company, and by doing so, you’re hoping that it will do well in the future.
Another reason you would invest in the stock market is to beat inflation. Inflation effectively decreases your value of money over time as prices rise. In other words, if you have cash sitting in a bank account for 30 years and inflation is at 4%, the actual value of your money will be 25% less than what it was worth when you put it there.
Put your money to work for you.
Give as a gift
You could give your spare cash as a gift.
Whether it’s a birthday, anniversary or graduation, giving someone their choice of gift is always appreciated.
You could pay for that course, trip or experience someone has always wanted to do. Seeing their enjoyment will be a powerful way to use your extra money.
Invest your cash in a high yield savings account
Finding a high-interest account can be tricky, but it is possible. Some banks offer higher than average interest rates on their savings accounts, so you can maximise the value of your cash.
You could also consider putting some of your spare cash in premium bonds in the UK. Investing in premium bonds gives you a chance to win big. The best part is that it’s tax free-so your money can go further!
Start building a strong emergency fund.
An emergency fund is a sum of money that you can use in case of an unexpected financial hardship or take advantage of opportunities. For example, if your car breaks down and you need a new one, it may be worth taking out a loan from your emergency fund so you can have the money for a new car when you need it.
You can start building your emergency fund by automatically transferring cash into a high-interest savings account every month.
Don’t forget about your retirement account.
No matter how much money you have, contributing to a company-sponsored retirement plan is a good idea. That means if your employer offers you free money in a matched scheme, don’t hesitate to contribute what you can afford every pay period because the sooner you start saving, the more you’ll have when you retire.
Remember that the money you are saving here is not lost; it’s just being stored up for your future spending.
Buying something for yourself every once in a while can be a great way to celebrate small wins or milestones achieved.
One way to spend it with a lasting effect is to use the money on experiences.
Ticking off something from your bucket list will have a lasting memory and sense of achievement.
Spending money on time with friends and family is money well spent.
Donate to a cause you believe in.
If none of the ideas above appeal to you, consider donating your cash to a cause that’s really important to you-like protecting endangered species from extinction, stopping human trafficking, or helping communities recover from natural disasters. There are countless people and organisations out there who would be thrilled to get your cash, so find the cause that’s most meaningful to you and give!
Conclusion: What to do with cash right now
Your money is a powerful tool that can help you achieve your goals. The key to making the most of it is understanding what you want out of life and then deciding where to invest, give away or spend it wisely.
It’s never too late to take control of your finances—or get some planning help.
If you have questions on what to do with cash right now, set up a call today for a free consultation.
I am more than happy to walk through all of our options so that you can make an informed decision on how best to use your hard-earned dough to live the life you want right now and down the road as well.