Your wedding guests' generous gifts mean you've got major money to spend. But before you blow it on a leftover wedding registry item, our expert says, you might want to consider a few more money-savvy alternative ways to spend your wedding cash.
"Rather than buying an espresso machine that you might realistically use twice, why not have your money grow so you can achieve your dreams together?" asks Elle Kaplan, finance expert and founder of LexION Capital. "Everything from buying a house to supporting your children financially can be achieved through smart investing, and it all starts with putting a few dollars towards your future together."
Here are four ideas to get you started with that wedding gift money.
1. Pay off your high-interest debt.
If you have any high-interest debt, then "aim to pay that off before doing anything else with your wedding gift money," Kaplan recommends. High-interest debt most often comes in the form of credit cards, but take a look at any loans you may have and compare their interest rates, too. Then, "put the biggest chunk of your money towards the highest interest rate debt," Kaplan instructs.
2. Spend a little — but just a little.
Whether it comes to dieting or investing, "extremes seldom work," Kaplan says. So if you're itching to spend some of that wedding gift money, then allow yourselves to indulge. "Just make sure it stays within range," Kaplan says. "Immediately allotting a small portion — say, $100 — toward something you and your partner can enjoy together will allow you to feel some balance while still investing in your future."
3. Add to your retirement fund.
Retirement may feel like it's a million years away. "But growing your retirement nest egg now will make planning for your golden years exponentially easier," says Kaplan, who recommends starting with a Roth IRA because your money can grow and be withdrawn tax-free. Plus, "there are low requirements to open a Roth IRA, so even your aunt's wedding gift can be used to start it off," she says.
Alternatively, if your employer offers a 401K match, then consider contributing your wedding gift money to your company's plan. "If you don't take advantage of your employer matching your contributions, you're essentially leaving free money on the table," says Kaplan. "This can make the power of each dollar invested much more powerful, especially when combined with the tax-free growth of 401Ks."
4. Start an emergency fund.
Sometimes simply saving your money is the best move you can make. Why? "An emergency fund is the way to sleep easy every night and avoid debt when an unexpected expense occurs," says Kaplan. "Everything from a broken faucet to car repairs can become far more costly if you need to finance them with credit card debt — and that's why you should save six to eight months of living expenses."