Congratulations, graduate! You made it through high school, and now you’re swimming in a sea of graduation cards stuffed with cash. Whether it’s a crisp $20 bill from Aunt Sally or a generous check from your grandparents, you’re probably wondering what to do with all that money. Fear not! We’ve got some advice, both from financial advisors and some more, let’s say, “creative” ideas to help you spend your newfound wealth.
The Responsible Route: Advice from Financial Advisors
Before we dive into the fun stuff, let’s get some sage advice from the experts. Here’s what financial advisors recommend doing with your graduation money:
1. Start a Savings Account
Okay, we know this sounds boring, but trust us, your future self will thank you. Starting a savings account is a great way to ensure that you have some funds set aside for emergencies or big future purchases. Look for a high-yield savings account so your money can grow over time.
Pro Tip: Set up an automatic transfer from your checking to your savings account each month. This way, you can “set it and forget it,” and your savings will grow without you even thinking about it.
2. Invest in the Stock Market
Investing might seem intimidating, but it can be a great way to grow your money over time. You don’t need to be the next Warren Buffett to get started. Consider using apps like Robinhood or Acorns, which are user-friendly and perfect for beginners.
Pro Tip: Start with a small amount of money and invest in a diverse range of stocks or ETFs. This helps spread out the risk and increases your chances of seeing positive returns.
3. Open a Roth IRA
A Roth IRA is a retirement account that allows your investments to grow tax-free. It’s never too early to start planning for retirement, and the earlier you start, the more time your money has to grow.
Pro Tip: Even if you only put in a small amount each year, compound interest can turn it into a significant sum by the time you’re ready to retire.
4. Pay Off Debt
If you have any existing debt, such as credit card debt or student loans, consider using some of your graduation money to pay it off. This will save you money on interest in the long run and help improve your credit score.
Pro Tip: Focus on paying off high-interest debt first, as it costs you the most money over time.
The Fun Route: Enjoy Your Hard-Earned Cash
Now that we’ve covered the responsible stuff, let’s talk about some fun ways to use your graduation money. After all, you worked hard to earn that cash, and you deserve to enjoy it!
1. Travel
What better way to celebrate your graduation than by seeing the world? Whether it’s a road trip with friends or a solo backpacking adventure across Europe, travel is a great way to create unforgettable memories.
Pro Tip: Look for budget-friendly travel options like hostels or Airbnb, and use student discounts whenever possible.
2. Upgrade Your Gadgets
Heading to college? You’ll need some reliable tech. Consider upgrading your laptop, smartphone, or tablet. These gadgets will be essential for your studies (and, let’s be honest, for binge-watching Netflix).
Pro Tip: Check out back-to-school sales for great deals on electronics.
3. Invest in a Hobby
Always wanted to learn to play the guitar or take up photography? Now’s your chance! Use some of your graduation money to invest in a hobby that you’re passionate about.
Pro Tip: Look for second-hand equipment or online courses to save money while getting started.
4. Treat Yourself
You’ve worked hard, so why not treat yourself to something special? Whether it’s a shopping spree, a fancy dinner, or a day at the spa, it’s important to reward yourself for your accomplishments.
Pro Tip: Set a budget for your splurge so you don’t end up spending all your graduation money at once.
Combining Responsibility and Fun
Who says you can’t be responsible and have fun at the same time? Here are some ideas that blend both worlds:
1. Create a “Fun Fund”
Set aside a portion of your graduation money for fun activities and use the rest for savings or investments. This way, you can enjoy your money now while still being smart about your future.
Pro Tip: Use a budgeting app to help you track your spending and savings.
2. Invest in Education
Consider using some of your graduation money to take a course or attend a workshop that interests you. Whether it’s learning a new language, coding, or cooking, investing in your education can be both fun and beneficial for your future.
Pro Tip: Look for free or discounted online courses from platforms like Coursera, Udemy, or Khan Academy.
3. Give Back
Use a portion of your graduation money to support a cause you care about. Whether it’s donating to a charity, supporting a local business, or volunteering your time, giving back can be incredibly rewarding.
Pro Tip: Choose a cause that aligns with your values and passions for a more meaningful experience.
Pro Tips from Real College Students
We reached out to some seasoned college students for their advice on what to do with graduation money. Here’s what they had to say:
1. Sarah, Junior at NYU
“Honestly, I wish I had saved more of my graduation money. College is expensive, and having a little extra cash for textbooks and supplies would have been a lifesaver. That being said, don’t forget to have some fun with it too. I used part of mine to travel before college, and those memories are priceless.”
2. Jake, Sophomore at UCLA
“Investing is the way to go. I put a chunk of my graduation money into a Roth IRA, and I’m already seeing returns. But also, don’t be afraid to treat yourself. I bought a new laptop that I use every day for classes and gaming. It’s all about balance.”
3. Emily, Senior at University of Texas
“I set up a fun fund with my graduation money, which was awesome for spontaneous trips and nights out with friends. But I also used some to attend a coding bootcamp, which has been invaluable for my resume and job prospects.”
Conclusion
In conclusion, your graduation money is a fantastic opportunity to set yourself up for success while also enjoying the fruits of your labor. Whether you choose to save, invest, or splurge a little, the key is finding a balance that works for you. Listen to the advice of financial experts, but also remember to enjoy this exciting time in your life.
So, go ahead and start planning how you’ll use that cash. Whether it’s a smart investment or a fun adventure, make sure it’s something that makes you happy and prepares you for the bright future ahead. Congratulations again, graduate, and happy spending!
Links to Useful Resources
- High-Yield Savings Accounts
- Beginner’s Guide to Investing
- Roth IRA Basics
- Student Discounts for Travel
- Budgeting Apps
Enjoy your summer, and best of luck in your future endeavors! 🎓
And don’t forget to check out our list of Dorm Room Essentials!
