Sometimes, you might be a little confused about what to use your money for. If you have mastered financial literacy, then you probably know there is what we call “Mindful Spending.” Mindful spending is the act of taking full control over your spending habits; you spend intentionally on what you need or what is in your budget. If you have built a robust emergency fund that makes you feel secure and comfortable, and you are wondering what else you can save toward or spend on without having regrets later.

Why is an Emergency Fund Important?

If you have managed debt in the past or are managing debt right now, you will probably know that having an emergency fund is one of the best financial protection you can give yourself. Take for instance, if your car breaks down and you don’t have any savings anywhere, you may want to use your credit card to fix the car. However, if you have an emergency fund, you can easily take out money from it, fix your car, and replace the money later without the interest you would have paid on a credit card.

Do You Have Enough Saved?

Having an emergency fund is one thing, having enough money in your emergency fund is another thing. Financial experts suggest that you should have an amount that can take care of your basic needs for 3 to 6 months. So if you are wondering what else to use your money for, be sure you have sufficient money in your emergency fund account. 

To be sure if you should keep building your emergency fund, track your expenses for three months and see how much you spend. If on average, you spend $4,000 monthly on your basic needs, it means you should have between $12,000 to $24,000 saved in your account. So, if you have less than that, you should continue to save. However, if you have more than enough in your emergency fund account, then you can consider the following ideas that will be discussed below.

Upgrade Your Skill(s)

One of the best investments you can consider is self-investment; it will pay you for life. Employers are paying for value, not just for time. If you continue to be a person of great worth and value, your wealth will keep growing. This could be an opportunity for you to brush up on your skills, get a degree, or pursue your dream career. When you increase your value, your money will potentially increase too.

Investment

Another important form of building wealth is investment. You could invest in a business, buy stocks, own shares, or invest in real estate. There are so many ways to invest these days, but you should also be cautious while at it. If you don’t have all the details about an investment program or if you don’t have trust in it, don’t go for it. It is better to speak with an investment expert who can guide you in making the right decision. You also need to know your risk tolerance. There is no 100% guarantee when you invest. Will you be okay if you lose your capital? It also takes patience, unless you are looking for a get-rich-quick scheme. Can you wait for years before enjoying the returns of your investment? These are questions you need to answer before going ahead.

Pay Down Debt

Making minimum payments on your credit card debt is not a good way to manage your debt. While it’s okay to pay the minimum required, it also implies you will pay forever. In other words, the payment will go towards interest and your principal will hardly reduce. If you have that extra money, clear off your debt so you can save money in the long run.

When you pay off your debt, you will enjoy peace of mind, and you will be able to have some fun. High-interest debts like credit card debts, payday loans, and other online loans can be draining. Getting them off your back is an important move. If you can’t manage these debts on your own, you can consider a consumer proposal, or you speak with a debt expert at EmpireOne Credit to know which debt management plan will best suit your situation.

Go on a Vacation

Working so hard is good, but sparing some time once in a while to have some fun is better. Life is too short, you should enjoy it too. Saving for a vacation is a fantastic idea if the extra money you have won’t suffice. This could be your opportunity to rewind, have fun, think about your achievements, and have new dreams. You could plan this with friends or family. You will be glad you did.

Bottom Line

It’s important to be mindful of how you spend your money, so you can stay financially fit. The dream of most of us is to be debt-free, have an emergency fund, have more than enough to cater for ourselves and our family, and enjoy the good things of life. But it all starts with being debt-free. If you are still carrying the burden of debt, there are so many opportunities you could miss. But there is good news, your debt can be reduced by up to 80%, and interest will stop immediately. You can speak with one of our debt experts at EmpireOne Credit, to know how we can be of help to you. Call us at (416) 900-2324 to schedule a free consultation with us. Being debt-free feels good!