Boost your retirement savings: Avoid spending windfalls

Sure, it’d be awfully swell to spend that $1 million inheritance from Aunt Matilda… But don’t. Here’s the best way to maximize those unexpected and unanticipated money that may come your way.

In today’s episode of Your Money Minute with Tracy Stewart, CPA, let’s talk about boosting retirement savings with windfalls. Yes, there will come a time when you come into money that isn’t expected or accounted for. Should you spend it all right away? No!

Here’s my take on windfalls: You can give yourself permission to spend up to 5% of any unexpected money that comes your way. Everything else should go straight into a savings account. Why? Because your savings account LOVES money — and because you don’t want to live under a bridge when you retire.

It’s hard to save money, especially when wants (not needs) pop up. But by saving now, you set yourself up for the many needs of your many tomorrows (and that sounds like a great plan to me.)

Financial independence is unbelievably liberating. Don’t wildly spend money you come into in good fortune. That money will serve you better with a little more time and a lot more interest.

Remember: Subscribe to my YouTube channel for daily episodes of Your Money Minute. I’ll share my favorite tips on making the most of your money and life each and every weekday. Until then…