I Just Won A Thousand Dollars!

… well, at least that’s how I feel every time I see unallocated money in my bank account. Sometimes after I’ve paid all of my necessary bills, estimated what I’ll need for my variable expenses, and put some money aside in my savings account, I’ll still have some cash left, and it can feel a bit like hitting the lottery (a very small one, at that). So what do you do with that extra $25 or $50 you still have just hanging out in your checking account?

Pay off your debt. This is probably the most important thing you can do, especially if you have a balance on your credit card. The longer you have a balance, the more interest you’ll pay, so it’s best to just get rid of it. Have outstanding loans? Pay a little extra this month. I consistently paid about $20 extra every month on one of my student loans, and not only did I get a reduction in my interest rate, but I also got a $30 credit added to my account for making all of my payments on time. Hello, free money!

Extra savings. Don’t feel like you have to spend it just because it’s there – tempting, I know. If you’re really not going to use it, add it to your savings account for when you might need it later.

A special treat (within reason). I’m not saying to go out and drop $100 on something frivolous and unnecessary, but maybe there’s a movie in theaters that you really wanted to check out or a new restaurant just opened in town that you’d love to try. If you can afford it, indulge just a bit. Your basic budget demands have been met, so go ahead and have some fun every once in a while… just do it wisely!

For more advice on how to manage your money, check out BudgetSimple’s Financial Success Game Plan.