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Illustration of four leaf clovers.
Illustration of four leaf clovers.
Illustration of four leaf clovers.

What to do with a "windfall."

Published January 3, 2017.
Updated April 21, 2020.

Tips for handling unexpected money.

It's great when you receive unexpected money, such as a tax refund, stimulus check, or inheritance.

If you've recently lost your job or are experiencing financial hardship, then a "windfall" is welcome relief to help meet your immediate need to pay the bills, buy groceries, and care for your family.*

While it's tempting to spend a windfall on something nice, there are other options that STCU's financial education officers have found to make unexpected money work for you. Here are a few:

Prepare for emergencies.

Depending upon the size of your windfall, you might have enough to cover such unexpected expenses as a flat tire or medical co-pay. Setting aside your windfall in a special "emergency" savings account can prevent having to borrow funds in the future. Find a savings account with a high dividend rate so it can earn money for you until you need it. 

Save it to spend it.

If you know you have upcoming expenses, stash away your remaining windfall funds to use later. For example, you could use your windfall to pay for holiday gifts, a vacation, tuition, or that home remodel you have been planning to complete. "Bucketing" your money is fun!

Invest it.

Make your money grow. Depending upon the amount and time before you need your windfall, it could make for a great certificate deposit, IRA contribution, or other investments

A windfall can be an opportunity to make someone else's day a little brighter.

Pay off debt.

Do you have a credit card balance owed? Want to get ahead on that auto loan? Use your windfall to pay down your loan and credit card balances to save on accumulated interest charges, and enjoy the relief of no longer making monthly payments.

Have a little fun.

If it pencils out, don't forget to do something for yourself. Go out to a nice dinner. Purchase that item you've had your eye on. Take a day trip.

Pay it forward.

If you're in a strong financial position, then a windfall might be an opportunity to make someone else's day a little brighter. Consider making a tax-deductible contribution to your favorite non-profit, or help a friend or relative out of a financial crisis. Either way, you'll feel good about helping others.

*Experiencing a financial crisis? Learn more about available assistance from STCU and other sources. 

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