5 Smart Things to do with your Wedding Gift Money
Between the food, the event space, the photographer and the band—you may have spent a large part of your savings on your wedding. If you were lucky enough to receive wedding gift money from friends and family, you can really make this newfound money work for you. Instead of using your cash for a trip to Cabo or on a new car, consider the following suggestions:
Start an emergency fund. We know it doesn’t sound as glamorous as a spa package, but starting an emergency fund can help to combat stress when something unexpected comes up. Whether it’s a sudden doctor bill or car repair, this saved bundle of dough will help if times get tough. It’ll also make you feel better to know there’s a bit of a cushion. We recommend opening an account that offers quick access and storing away $1,000—you can always add to it.
Pay some bills. You’ve just planned a huge event and you’ve paid your fair share for it, so don’t feel guilty about using some of your gift money for your monthly bills, or even prepaying your mortgage if you have one. If you’ve been carrying around some unwanted debt—credit card, student loan, car loan—consider paying off some of it. Having trouble deciding which to pay off ﬁrst? Start by paying off the loan with the highest interest rate.
Watch it grow. It’s a smart idea to save and invest a big chunk of your gift money—this way it can gain interest and over time make money for you. It could be your down payment on a home or a nest egg for retirement. A financial adviser can help make sure you’re putting your dough in the best account for you, whether that be a tax advantaged plan, like a traditional IRA or Roth IRA, or a CD or state-sponsored 529 plan.
Invest in your home. If you’ve been eyeballing a place to call your own, your wedding money may make a nice down payment. As you probably know, the larger your down payment, the less interest you’ll typically end up paying on the loan. If you’re still on the fence about owning a home, check out Allstate’s “Am I ready to buy a house” checklist.
Already have a nest? You could make updates and improvements to your current place, which can potentially increase its property value. Here’s the scoop on what’s hot in kitchen and bathroom upgrades.
Look into life insurance. Now’s the perfect time to take out a life insurance plan for you and your new spouse. Pushing a plan to the side any further will make it more difficult to attain. Thankfully, this isn’t a huge investment, just a smart one. Allstate offers three kinds of life insurance plans to serve budgets of all sizes. Check out our life insurance tools here.
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Start saving for your future. Contact a Chicagoland Allstate Agent to learn more about your financial options.