If you work hard for a living, then you cherish the money you earn. If you are also diligent about living within your means, then your savings accumulate over time, eventually massing up to many thousands of dollars.
Of course you can wind up with thousands in savings for other reasons too, ranging from huge tax returns, settlements, inheritance, and other kinds of windfalls.
Whatever causes this much money to fall in your lap, you do have to decide how to put it to use. Keep reading to learn 5 smart things to do with $10,000 of savings.
1) Create an emergency reserve fund
Everyone should have enough money saved up to live off of for six to nine months should the situation ever arise. Job losses, injuries, illnesses, and bad economies do happen from time to time.
2) Make your money earn more
If you have the $10,000 parked in a savings account, it’s probably generating some interest for you. Consider moving it to a money market account though. It’ll still be incredibly safe and make more money.
Other options that are still rather conservative options but generate even more money include municipal bonds and blue chip stocks that pay regular dividends.
3) Buy a barely used car
Believe it or not, but ten thousand bucks will get you a reliable vehicle in many markets. The trick is to look for something that is used, but barely.
Something only a year or two old still has most of its life left, but has gone through enough miles to demonstrate it’s not a lemon. It’s also already gone through the value drop that happens from just driving off the lot.
Rental cars are often sold at steep discounts after just a year or two and are impeccably well-maintained.
4) Do some home improvements
If you plan on remaining in your home for many years, then customizing it to fit your needs pays off for decades to come, and you might even boost your home value enough to get a better mortgage deal or additional equity and credit you can tap into.
If you are looking to sell, then you can afford a renovation or two that add dramatic value to your property and selling price.
5) Get a degree
Few expenditures offer as much lifetime return on investment as a college degree. Ten grand might not seem like enough to be a full-time student at a four-year school, and that’s mostly true.
However, if you are a working adult, and especially if you already have some college credits under your belt or even a degree already, then this should be enough to take night and weekend classes at a community college to either finish a degree or get a second one.
Now that you know 5 smart things to do with $10,000 of savings, you can handle large windfalls wisely. Even smaller sums of money can be managed with wisdom with this handful of ideas.