Want To Use Your Disposable Income Smartly? Here Are Some Ideas To Consider

There are quite a few people out there who have a good chunk of disposable income left over at the end of the month. This is any money you don’t need to use to pay the bills, restock the refrigerator, or pay down debt, and it’s genuinely just spare cash you can use in any which way you like. 

If you’re a person who has a wallet like this, you’re probably also someone who wants to make as best a use of your disposable income as possible. If you’ve gotten a lot more of it than usual lately, you’re definitely going to want to find a way to make it work for you! Getting used to handling disposable income is just as much a financial skill as any other.

And if you’re after a bit of advice regarding that, this little guide could be a great starting point for you. If you’d like to use your disposable income in a smart way, here are some options to consider during your household budgeting meeting.

Build As Big An Emergency Fund As You Can

You never know what could go wrong in life, or how long you’ll have to pay off the damage caused by an unfortunate event. As such, it’s best to build as big an emergency fund as you can. If you’ve got a more significant amount of disposable income in your pocket right now, putting a good portion of it away will definitely help you out in the long run. 

You can try to invest in the long term, in an account that ensures the money is locked away for as long as possible. Be sure to double check what the best interest rate is, as well as the historic rates allowed by the providers you’re interested in. If you’re going to shut yourself off from the cash, you need some kind of guarantee you’re doing so at a good time.

You can also put it in a normal savings account that pays a bit of interest here and there, but allows you to have access to the money as and when you need it. The more money that’s in the account, the higher your interest will be at the end of the year. 

That can usually net you around 1-5% more than you put in, and every spare penny you can scrape together for the fund is really going to help. 

Make A Tangible Investment

How often do you invest? It’s still not something people do too often, but it’s good to have a few investments on your side for the future. Put the money in now, get the value out when you’re older, have a great retirement! As such, when it comes to making good use of disposable income, we recommend trying out a few tangible investments. 

And we say tangible simply because it’s more fun that way! In most households, the disposable income you have is often put toward the things you enjoy. Your hobbies, treating yourself and your loved ones, etc., and that’s something we think you can still prioritize when looking to invest. 

After all, a tangible investment is something you can actually see, hold, and use. If you put your spare cash into things you can really get some enjoyment out of, you won’t mind using the money that way – and you’ll also be able to truly track the value you’re racking up at the same time. 

So, maybe it’s time to invest in nostalgia? Old teddy bears and soft toys, old board games and video games, comic books you used to love – these can all be very valuable. Source them right, keep them in as good a condition as you can, and sell them on again when that nostalgia cycle starts to rack up in five to ten years’ time.

You can also think about your car here too. Private number plates for sale are great for putting a low amount in and getting a high amount back out. Get yourself a unique, cool, and catchy plate and you can guarantee there’ll be someone else who wants it out there! 

You can use the plate on your car – of course, make sure it’s been registered – and then sell either the plate itself or the plate and the car in a few years from now. 

Think About A Pension

This is a specific way to save for the future, and most people get a pension plan via their employer. You still get paid every month, and some of it goes into tax, but now some of it goes into the pension too – which can also reduce the amount you have to pay for the former. 

You can also hold quite a few different pensions, if you’d really like to. As such, a private pension plan could be another good way to use your disposable income in a smart manner. The more you put away for the days when you’re retired, the more you’re going to enjoy that period of your life. 

Plus, if you ever need a heightened amount of assistance at a later age, you’ll have the money in place to ensure you’re taken care of. Saving for the future is the goal most people have when they want to consider the best ways to use their money, so why not dig into the facts of taking out another pension and see if that would suit you? 

If you’re in the market for a better way to use your disposable income, ideas like these are the kind to chew over. 

Make sure you leave a bit left over for you to enjoy right now – and taking a vacation is something you should let yourself do from time to time – but put as much ‘away’ as you can. 

Finally, keep one thing in mind: taking a step towards financial wellness is always going to be a good thing, no matter what you end up doing with your spare pennies!