Getting a tax refund, bonus or inheritance
Top tips to make the most of your windfall
If you get a windfall such as a tax refund, a bonus, or an inheritance, you might be tempted to splurge on things you don't need.
Here are some smart ways to spend this money that will give you long-term benefits.
1. Pay off debt
2. Put it in a high interest savings account
3. Contribute extra to your super
4. Consider investing
5. Get financial advice
Pay off debt
You could use this money to pay off your credit card bill or pay down your mortgage or personal loan. Paying off debts means you'll pay less interest and save money.
Use credit card calculator to work out how much you'll save in interest by making extra repayments.
Use budget planner to help you plan where you want your money to go.
Put it in a high interest savings account
Make this the start of a new savings plan by putting the money in a high interest savings account. There your money will grow with the power of compound interest. For example, if you put a $3,000 tax refund into a high interest savings account that earns 5% interest, in 5 years time you'll have $3,850.
If you have a smartphone, download our free savings app TrackMyGOALS. It will help you put together a savings plan and set, track and meet your savings goals.
You can also use saving goals calculator to work out how much you'll earn in interest if your savings are put in a savings account or term deposit.
Contribute extra to your super
Making extra contributions to your super can really boost the amount of money you have to retire on. The catch is you won't be able to sepnd it until you retire.
If you are on a low income, the government will match your after-tax super contributions. The co-contribution matching rate is 50c for every dollar you contribute up to a maximum of $500.
If you want to know where you can get the most benefit from your money use super vs mortgage calculator.
Investing your windfall can really make your money go further.
If you're new to investing, start with investing basics.
If you would prefer to rely on professionals who are skilled in making investment decisions, a managed fundcould be right for you. For more information see managed funds.
Get financial advice
For large amounts of money, such as an inheritance or a redundancy payment, you should consider getting financial advice. An adviser should be able to help you work out a strategy to make the most of your money.
Think through your options and use your windfall to give you a real financial boost.