The Best Ways to Use a Few Hundred Dollars

Sometimes it can feel like you need thousands of dollars to make a real impact on your finances. But what if you find yourself with a few hundred dollars—maybe from a tax refund or an unexpected windfall? The temptation to spend that money can be strong. After all, how much difference can $500 really make?

Used wisely, even a small amount can put you on the path to a more financially secure future. Here are some ways to make those extra dollars count:

  1. Start an Emergency Fund: While the ideal goal is to have six months' worth of living expenses saved up, starting with $500 is a great first step. Once you have that initial amount set aside, it can motivate you to keep adding to it.

  2. Take Advantage of Compound Growth: Before you spend that money, think about putting it into an Individual Retirement Account (IRA). Not only will compounding help your balance grow over time, but increasing your pretax contributions can also lower your tax bill.

  3. Save for a Bigger Purchase: Whether you’re eyeing a major home renovation or planning a dream vacation, consider depositing that money into a credit union savings account. Whenever you have a little extra come in, add it to your savings. You might end up with a memorable family experience or a valuable investment.

  4. Donate to Charity: If you itemize deductions on your tax return, consider giving to a cause you care about. Not only can you deduct the donation, but it might also bring you more joy than spending that money on yourself.

Remember, every little bit helps! To get started on your savings journey, visit one of our financial consultants at the credit union. They can help you create a personalized plan that suits your goals.

Cy-Fair FCU