Help me spend my money!

December 22, 2010 9:51 AM

Unexpectedly received a holiday bonus check today. What should I do with it?

I rarely have "free" money that I feel like I can spend or give away, so I have a hard time thinking big. I do have credit card bills to pay, but I budget well and have all my finances in order. I hesitate to just throw it in my checking or savings, because I've done that before and it just sort of... disappears, blends into my other money and it's like it never was there. I'd like to do something more constructive, something that has real-life effect, so that I can look at something or remember something and think "thank you company, this is because of you." I guess the question is: if you were handed a thousand dollars today that you weren't expecting, budgeting for, you don't need necessarily... what would you do with it? Charity? If so, which one? Awesome present for a loved one? Something else?

posted by coupdefoudre to Work & Money (29 answers total)

I'd be totally selfish and make a big dent on that credit card.

You can always make a donation to the Chris Backe Travel Fund, if you're looking for a more altruistic purpose :)
posted by chrisinseoul at 9:52 AM on December 22, 2010 [1 favorite]

if you were handed a thousand dollars today that you weren't expecting, budgeting for, you don't need necessarily... what would you do with it?

I'd put it toward any outstanding debt that I have, absolutely. Being debt-free is a wonderful, wonderful thing.
posted by ocherdraco at 9:56 AM on December 22, 2010 [6 favorites]

I second the credit card! Although you've budgeted and seem to have it all in order, the saved interest from the $1,000 investment into your credit card debt will allow you to do more charitable or fun things later on.

Or you could donate it to Ms. Chaiwawa to do the same! :-)

Congrats on the extra moola this holiday season!
posted by chaiwawa at 9:57 AM on December 22, 2010

Clothes. Mmmmm, clothes.
posted by milarepa at 9:58 AM on December 22, 2010 [1 favorite]

Yeah, unexpected money is great for paying down credit cards. Just think of how much money you'll save in interest by paying $1k down right now!

Otherwise, there are tons of charities out there to support, Kiva, Childsplay, etc...
posted by Grither at 9:58 AM on December 22, 2010

Don't bother with checking/savings. If you budget well you should be secure on that front. Do the math on the credit card debt: how much will you save in interest if you were to throw the entire bonus as it? Are you willing to give up that amount if you spend the $1000 on something else?
posted by griphus at 9:58 AM on December 22, 2010

Treat yourself and a friend to a really nice meal, then the rest to a credit card. If you want, a smallish donation ($150) to a local food pantry or soup kitchen can go a really long way.
posted by yarly at 9:59 AM on December 22, 2010 [3 favorites]

I'd pay as much of the debt as possible. Maybe keep back a hundred or so to blow on clothes.
posted by something something at 9:59 AM on December 22, 2010

I would give part of it away (to a charity, someone begging on the street, modestneeds.org, whatever) and use part for debt. Then I would take a look around my place and see if there's something that needs to be upgraded or replaced. Is there something that is just annoying to deal with? Is something you use every day not working properly? Sometimes fixing the day-to-day is a great relief.

If it were me, I would upgrade to a stand mixer from a hand mixer, because I like to cook. I would look into getting various attachments as well, because I want to start making my own ground meat, for example. And then I would look into buying bulk, high-quality meats. But that's me - I would enjoy the research and the recipe planning, and I don't have the cash on hand to sink into getting started.

But don't make it too mundane. I wouldn't use it for a new vacuum cleaner, for example, unless you just hate yours and a new one would bring you joy. Are your clothes shabby and you need some new ones? What about some really nice shoes that will last you years?
posted by runningwithscissors at 10:01 AM on December 22, 2010

Oh, and if you want something that's fun and lasting as well, how about something for frequent use in the home? That one piece of kitchen equipment you've been lusting after? A great knife, that perfect sautee pan, or a small Cuisinart can be had for less than $100, but they're things you will use a lot and be pleased with. Or splurge on a luxurious new towel set or some sheets.
posted by yarly at 10:02 AM on December 22, 2010

if you were handed a thousand dollars today that you weren't expecting, budgeting for, you don't need necessarily... what would you do with it?

Treat myself with $50-$100, put the rest into my highest interest debt.
posted by EndsOfInvention at 10:02 AM on December 22, 2010 [5 favorites]

Wow, aren't we a bunch of responsible folks? Spend it all on hookers and blow!

Just kidding -- I too would put a windfall like that toward debt, saving a little bit for a splurge of some sort.
posted by me3dia at 10:06 AM on December 22, 2010

Have you put anything into a Roth IRA this year? That would be the first thing I'd do. If you've maxed one out already, I'd pay down debt.
posted by peanut_mcgillicuty at 10:07 AM on December 22, 2010 [1 favorite]

90 percent to pay down debt, 10 percent to blow on something awesome.
posted by Etrigan at 10:09 AM on December 22, 2010 [5 favorites]

I would give a bit towards the charity of your choice - food pantries, st jude's, animal shelters, etc - but keep the majority and pay down your bills with it.
posted by kpht at 10:09 AM on December 22, 2010 [2 favorites]

I do have credit card bills to pay,

There's your answer. Paying down debt is more money in your pocket down the road - more than $1000. Sit down with a debt snowball calculator and figure out the difference between applying this and just sticking with your current payments. Hmm!

If you want a little bit of indulgence, then I agree - 90/10 split. A hundred bucks for some clothes or a great dinner.

Charity is tempting. So are clothes and travel. But you will be in a MUCH better position to make more significant donations, and/or buy more clothes and travel, when you are debt-free. Getting debt-free as fast as you possibly can is the path to a life where you can do much more of the things you love. It's a gift you can give yourself.
posted by Miko at 10:23 AM on December 22, 2010 [3 favorites]

I do agree with everyone else about paying down debt. Long-term, this will have the most benefit.

However, if you're looking to get something awesome for yourself, here are some ideas:

• Smartphone (Nexus S, iPhone 4, or similar) - If you don't have one of these, you don't know what you're missing. SO useful.
• Weekend trip - Have someplace you've always wanted to visit? I often fly out Friday evening, driving straight to the airport from work, and fly back Sunday evening. Spending Saturday and most of Sunday at my desired location. $1000 will get you a weekend round trip plane ticket, restaurant meals, and a couple nights in a hotel almost anywhere in the continental US, assuming you're traveling alone. With a companion you'd have to be a bit more choosy about where you go, but you'd still have plenty of options for $1k. If you'd like to go to Hawaii, $1000 would likely pay for the ticket, at least if you avoid peak travel periods, but you'd need more money for hotels/expenses.
• Musical Instrument + lessons for a short period - Ever wanted to learn to play the guitar or keyboard? You could get a decent "amateur" model and use the left over money to finance lessons for as long as it holds out.

Financially speaking, paying down the debt is the best option, but you're allowed to have some fun from time to time too. Can't decide? Don't be hasty - buy a 6-month Certificate of Deposit (CD) and mull it over until it matures. You're less likely to cash out a CD early and pay penalties then you would be to chip away and a checking/savings deposit.
posted by Vorteks at 10:55 AM on December 22, 2010

Obviously, paying down debt is a responsible choice, and it is a good choice for you, especially in the long run. But how often do you find yourself in this situation, with extra money to spend and no need to spend it on anything in particular?

I would put at least half toward paying down your highest-interest debt, but use the rest for something you wouldn't normally spend money on. Something that makes you happy and feels a little indulgent. If that's charity, or a nice meal, or a skydiving trip, whatever - enjoy at least part of the bonus.
posted by hootenatty at 11:03 AM on December 22, 2010

Best answer: Cigars and Scotch.
posted by Ad hominem at 11:33 AM on December 22, 2010 [1 favorite]

Response by poster: Probably should've been clearer re: the credit cards - I don't have DEBT debt, I have just have 1 credit card that I use and the bill needs to be taken care of monthly. I'm totally cool with paying chunks of 200-400 every month, the interest I rack up is negligible. I'll probably use a couple hundred towards the CC, but I'm really looking for fun things here. Thanks everyone!
posted by coupdefoudre at 12:06 PM on December 22, 2010

Pay off debt. Calculate the "to what" by working out the drop your monthly payment, and put it towards whatever gives you the biggest drop.
posted by burhan at 12:06 PM on December 22, 2010

Best answer: Having read your follow-up comment . . . If it were me, I have a cousin who is like a sister to me and is having trouble making ends meet. I would get more Christmas presents for her and her kids. If you don't have someone like that in your immediate circle of family and friends, could you adopt a local family? I know the Salvation Army has this program, but local churches might, too. I usually get a tag to get gifts for a kid, and it is lots of fun to pick out presents. Being this close to the holidays, you might just want to donate the money.

I would save a little for myself and buy something splurge-worthy that I've had my eye on, too.
posted by aspiring polymath at 12:30 PM on December 22, 2010

I would first use 10%-20% as an offering to a local charity -- St. Vincent DePaul, food pantry, Toys for Tots, etc. The more personal the better. Then buy something good for me that I've been wanting (comfy shoes, etc.) Then the rest goes toward debt.

In fact, that's just what I am planning to do with my bonus I wasn't expecting.
posted by cross_impact at 12:43 PM on December 22, 2010

Best answer: Pay for you and a friend, or a few friends, to have a night out doing whatever you think is the most fun -- going to a concert, drinking a lot, getting spa treatments, staying at a fancy hotel, whatever. Something you wouldn't ordinarily get to do. Make it clear in advance that it's your treat.
posted by chickenmagazine at 12:52 PM on December 22, 2010

If I were young and single, I'd take the most desirable* thousand-dollar trip I could squeeze into that budget. Most things that you could splurge on now you could splurge on just as easily in 10 or 20 year's time. But traveling obeys different laws. You can put together a really awesome, memorable trip on a thousand bucks when you're young and single, in a way that becomes harder and harder to do as you get older.

* What's desirable for me might not be desirable for you.
posted by SomeTrickPony at 1:00 PM on December 22, 2010

Best answer: Go to your favorite bar and buy a round for the whole bar. It is the greatest feeling ever.
posted by nestor_makhno at 1:06 PM on December 22, 2010 [1 favorite]

Go ahead and be charitable with some portion, but don't put it toward a charity per se. I also recommend Kiva.org. The problem with typical charities is that they are donor-driven, not donee-driven. Very often, a charity calls the shots and says, "Your community needs this, here you go" regardless of what that community actually needs. Programs like Kiva, where entrepreneurs are borrowing working capital, are driven by the borrower, who knows exactly what he/she needs. Also, since there is pressure on the borrower to repay the money, the money lent is much more likely to be used properly. Charities can be shockingly wasteful and ripe for corruption on the distribution end.
posted by holterbarbour at 4:02 PM on December 22, 2010

Most responsible answer: Pay any and all debt first. Do the math.

If you're too responsible to be burdened by the above, most responsible answer: Pretend you never got it, and put it in some sort of interest bearing savings or other liquid asset as a hedge against a rainy day. Piece of mind against unexpected expense (think lost job, broke car, medical expense) is priceless.

Best Kharma Answer: Charity. I'm with @Grither, Childsplay is one helluva good cause. Toys for Tots as well. Your local veterans association is probably looking out for families with a deployed parent, and many of them are otherwise going to have a very thin holiday, emotionally and materially. It's getting pretty damn cold, and lot's of kids don't have coats, hats, gloves and warm shoes. Lot's of opportunities there.

My answer: I'm with @Ad hominem: Cigars and scotch. And steak, dry aged. An excellent port if there's anything left.
posted by kjs3 at 4:18 PM on December 22, 2010

Best answer: I'm spending my unexpected bonus on ballet classes. I've been wanting them for a long time but had no extra money in my tight budget. Also, I used a little of it for a charitable donation. Contributing the money to paying off student loans, or funding an IRA, would be the "financially responsible" thing to do I suppose, but what's the point in being financially responsible if you're not also enjoying yourself once in a while?
posted by Dilemma at 12:05 AM on December 23, 2010 [1 favorite]