What are Wise Ways to use you Wedding Gifts?
Wise Ways To Use Your Wedding Windfall
While tearing through stacks of wedding presents when you return from your honeymoon is fun, you’ll probably enjoy opening the envelopes you received even more. As tempting as it may be to blow that windfall on impulse purchases, it’s wiser to treat it as a building block for your future. Here’s how to use those generous gifts to positively impact your lifelong financial situation, presented by For Better & For Ever ™.
Prepare for Emergencies
Despite your newly wedded bliss, you know that unplanned expenses can crop up at any time. That’s why building a rainy day fund is important. Things like car repairs and doctor bills can quickly outpace your income, so using your gift money to start an emergency fund will help you weather those unexpected outlays.
The beginning of your marriage is also a good time to purchase life insurance. Experts recommend getting policies as soon as your finances become entwined, so each spouse has a financial cushion if one of you passes. Just don’t make the mistake of buying a policy and never revisiting it. Review your needs whenever you experience a major life event to ensure your coverage is sufficient.
Build Your Wealth
Although money can’t buy happiness, increasing your net worth will help you and your new spouse live comfortably and securely. The appreciation you'll earn from your first home is a key wealth-builder, so putting your gift funds toward buying a house is a smart idea. Although the median down payment for first-time buyers is 6%, some lenders only require 3%, meaning your wedding money may give you a better head start on saving than you think. While putting down less money increases your monthly payment, purchasing a house takes rent off your expense list and gets you started on building equity.
Another forward-thinking move for your windfall is to use it to boost your earning potential. Getting a master’s degree or higher can reward you with more career options while increasing your income, further padding your financial future. You can also up your earnings by pursuing certifications in your field. Using gift funds to become a licensed CPA or certified IT professional can add big bucks to your annual salary without requiring you to go back to school.
You could also use gift funds to start a business as a couple! There are many options, from opening a coffee shop to starting a consulting firm. Depending on your line of work, you might also want to integrate a bank loan API into your website to allow customers to securely review their balances and set up payments.
Plan for Retirement
While retirement may be the last thing on your mind as a newlywed, using some of your wedding money to fund your golden years is a move you won’t likely regret. Setting up a Roth IRA right after you’re married and contributing to it regularly will give your money time to grow into a substantial retirement nest egg.
You should also join any 401(k) savings plans offered at your current and future jobs, especially if your employers match contributions. Failing to take advantage of matches is like leaving free money on the table. If you’re worried about feeling the pinch of deductions from your paychecks, use a portion of your gift funds to cover the gap until your finances stabilize.
If you’ve received a wedding money windfall, it can be tempting to splurge on fun things. However, establishing an emergency fund, investing in real estate and education, and saving for retirement are much better options for getting your marriage started on solid fiscal footing. Making wise financial choices today can reward you well into your golden years.
At For Better & For Ever ™, our mission is to be an on-line resource for dating/engaged couples, clergy, married couples, marriage educators…..anyone who cares about marriages and families. If you have any questions, let us know!
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