10 things to do with $1,000

Let’s say you just received an unexpected bonus at work, or you got a sizeable return from the tax man,
or you refinanced your home loan with BankVic (smart move!) and you now have a cool $1,000 in your hot little hands.

What do you do with it?

  • Do you spend it or save it?
  • Do you stash it away somewhere and save it for a rainy day?
  • Do you pay off outstanding debts?
  • Do you start a new DIY project at home? 

We asked our team what they would do if an unexpected $1,000 landed in their lap. The result? 10 ideas for how to spend or save that extra cash. Find us on Facebook and tell us what you would do with an extra $1,000. 

Idea 1

Emergency FundBoost up your emergency fund

An emergency fund (also known as a 'rainy day' fund or savings buffer) gives you some breathing space when life throws you a curve ball.

With one in five Australians not having enough savings to cover a $500 emergency and one in eight Australians having less than $100 to cover even a small setback, it's a good idea to have an emergency buffer set aside to help cover the cost of unexpected expenses. This could be for major car repairs, a replacement washing machine or should a family member fall ill.

If you're starting an emergency fund, aim to build it up to the point where you have enough savings to cover 3 months of living expenses. You'll also need to make sure you can access your money quickly in times of an emergency, but not too quickly. You don't want to be dipping into your emergency fund for that takeaway dinner or a new pair of shoes.

You may wish to consider an online, at call savings account or a bonus saver that can reward you with bonus interest each month. If/when the time comes to needing the money, you can always transfer it to your everyday access account via internet banking or going into a branch. 

Idea 2

Emergency Fund.Pay off your credit cards

With Australians owing approximately $32 billion on credit cards, and minimum monthly repayments only repaying a small percentage of the actual balance; paying off your credit card sooner rather than later could save you money in the long run. 

One of the most popular ways of paying off debt is by paying off small debts first, then focusing on the big ones. Also known as the 'debt snowball method', this method prepares you for progressively paying off your bigger debts. When you tackle your first small debt, you make the minimum repayments plus whatever else you can afford.

Once you've paid off this debt, you move on to the next one. Only this time, you add whatever you were paying on the first debt to the minimum amount you need to be paying on this one. This way, you slowly scale up your repayments. 

Idea 3

Emergency Fund.Reboot, recharge & refresh with a short break

Sometimes all you need is a short break to re-energise yourself and reconnect with the important people in your life.

You don't need to go too far or for too long to enjoy the benefits of a well deserved break. Just think, you could be enjoying the feel of sand between your toes, fresh mountain air, and delicious food.

With so many flight and hotel deals around, you'll be amazed where $1,000 can take you. It could be a 3 day getaway at a cosy B&B in country Victoria, a short domestic flight to somewhere warm like Byron Bay or Bali, or a luxury long weekend staying at a five-star city hotel; enjoying all the delicious restaurants, cafés and bars right here in Melbourne.

Idea 4

Invest in yourself.Sharpen your personal and professional skills

Learning is for life, not just for childhood. While the thought of going back to study may be daunting, it could also prove to be financially and emotionally rewarding both personally and professionally.

Not only is a great way of learning new skills and growing your career or earning potential, it can also improve your overall well being and boost your self confidence. 

With free online courses, informal classes, networking groups and educational phone apps, it's never been easier to brush up on old skills, keep up with industry trends, learn a new language, turn your passion into a profession or dive head first into a brand new topic. So what are you waiting for? Start investing in yourself today. 

Idea 5

VolunteerDonate to a charity close to your heart

Australians are a giving bunch and on average, spend approximately $1000 on Christmas presents each year. But have you thought about giving the gift of charity or donating money to those less fortunate instead?

A recent study conducted by the University of Oregon found that the brain's pleasure centers became activated when people decided to donate a portion of money to charity, rather than keeping it all for themselves. Whilst the study was controlled, it showed that donating money made people feel better, which is definitely something we could all benefit from. 

A great way of maximising your happiness is by giving more often, in smaller amounts. This also allows you to support a number of different causes and projects that are close to your heart. 

Idea 6

Get fit and healthyGet fit and healthy

There's no better investment you can make than on your own health and wellbeing. Sometimes all you need to do is find an exercise program you'll actually enjoy doing.

With an extra $1,000 to spare you can finally begin a fitness program or upgrade your current one. And it's not just health and fitness you gain, you'll benefit from having more energy, better self-esteem, new friendships and so much more.

$1,000 can go towards buying a bike, taking tennis lessons, joining a boot-camp, attending semi-personal training sessions (which is cheaper than one-on-one personal training) or pilates or yoga classes.

Idea 7

Home improvementsMake some improvements around the home

Investing in your home doesn’t have to cost a fortune. No matter if you’re tackling those odd jobs, starting a DIY project or sprucing up your home, there are a number of cost effective improvements you could make around the home to add significant value to your home.

Have a green thumb? Then why not start your own own herb or vegetable garden. There is nothing more rewarding than watching a tiny seedling emerge into something ready to eat. Plus the good news is, you don't need a lot of room to start your own garden. Vegetables grow just as well in a pot as they do in the ground. All you need is a small outdoor space like a balcony to get started.  

If your kitchen is in need of a makeover but you can't afford to purchase expensive cupboards and tiles, investing in laminate paint is a great way to cosmetically change the look of your kitchen, without the hefty price tag. 

Idea 8

Luxury HolidayCreate a savings goal and start working towards it

Setting a savings goal for yourself whether large or small, short or long term, can turn the act of saving from being a drag into something exciting and motivating.

No matter whether you’re saving for a holiday, a house deposit or a brand new car; you can reach your goals sooner simply by having a solid savings plan and solid saving account. 

Handy tip: to make your money grow faster, look for a saving account that pays compound interest - it’s like double chocolate topping for your savings, whereby you earn interest on the money you deposit, and on the interest you have already earned - so you earn interest on interest!

Idea 9

DiningHave a little fun in your life

Budgeting can be a bit like dieting, the more you tell yourself you can't have something, the more you'll want it. So whilst it's important to save and spend responsibly, it's equally important to reward yourself every so often. 

If you're regularly paying off debts, boosting up your emergency fund and contributing to your savings plan, it might be time to put that surplus cash towards something that makes you feel happy to be alive.

The options are endless. Choose from staying the night in a luxurious 5-star hotel, going to dinner at a fancy restaurant with your friends and family, updating your wardrobe or getting a fresh new hairstyle.

Just be sure to set yourself a budget and no matter what, stick to it.

Idea 10

Put it to work

Invest in the market

If you're debt-free and have a sound emergency fund, it might be time to consider an investment strategy and put any extra cash to work so it will compound and turn into more over time.

Before you start an investment portfolio it’s a good idea to set yourself a strategy on why you want to invest, how long you plan to invest for and what your attitude to risk is. The earlier you can start putting money into investments, the more time your wealth has to grow.

Whether you're starting out in life, increasing your wealth or planning for retirement, for as little as $1000 you can make some of the easiest and most worthwhile investments.

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