Watching Your Wallet: How to handle financial windfalls

Watching Your Wallet: How to handle financial windfalls
Published: May. 18, 2022 at 6:03 PM EDT
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LANSING, Mich. (WILX) - Most of us won’t win a large sum of money, like the lottery, in our lifetime, but we do sometimes get a nice, unexpected mail delivery -- like those insurance refund checks.

Whether it’s a child tax credit, a COVID relief check or even a tax refund, we’ve all looked forward to unexpected piles of cash. But are we making the best use of that surprise cash?

When you get a windfall, financial experts said it’s important to stop and think about the good and bad money decisions of your past. Sure, you can erase debt with a windfall, but how many times do you repeat the same spending habits and rack up more debt?

It’s also important to focus on your intermediate to long term goals, not short term wants. Ask a partner or friend to hold you accountable to make sure you do what you say you’re going to do with the extra money.

Experts said the real key to managing a windfall is to take your time and put some separation between when you get the money and how you use it. That way you aren’t giving into urges and instead making a solid plan for that money that could truly help you with debt or building up a savings.

More: Watching Your Wallet

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