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9 brilliant financial moves you can make with $50

Financial resolutions

Is the glass half full or half empty? Will that 50 bucks you just got do wonders for your bank balance? Or is it just a drop in the ocean of your financial troubles?

Fact is, you can do a whole lot of earning with $50, whether the loot comes from a bonus, a birthday envelope, a scratch-off lottery ticket or a buddy who paid off a bet. It may not be a windfall, but it can be a down payment on a better financial future.

So let's turn that $50 worth of lemons into lemonade and champagne! Here are 9 brilliant financial moves you can make with $50, how you do them and how much profit you'll make after that $50 has left your pocket and gone to to work.

WHAT YOU CAN DO HOW YOU DO IT WHAT YOU GAIN
Cut your credit card debt Knocking $50 off a $2,000 credit-card balance (at 16%) will cut your payback time by four months. That's if you're only paying the $40 minimum right now. You'll more than double your money by saving $103 in interest.
$53
Slash
your
mortgage
Use it to start paying down your mortgage -- then do it every month and that first $50 will have started down the road to riches! If you have 25 years left on a 30-year, $100,000 mortgage at 8 percent, increasing your payment from $734 to $784 shortens your payback by four years and three months. You'll save $25,065 in interest.

$25,015

Stop
bouncing checks
Buy the latest copy of Quicken or Microsoft Money software and start keeping your checking account in balance. Let's figure that some careful bookkeeping can help you avoid four rubber-check charges this year -- at $29 each -- That's $116. Plus, getting a good look at the rest of your finances ought to let you find lots of other ways to save or make money.

$66+

Earn
interest
tax-free
Buy a $50 Series "I" U.S. Savings bond. "I" bonds are sold at face value and grow with inflation-indexed earnings for up to 30 years. You can defer federal taxes on earnings for up to 30 years, and "I" bonds are exempt from state and local income taxes. The current rate is 7.49 percent; at that rate, in 10 years, you'd have $102.96.

$52.96

Invest
in your relationship
There's more to life than money. Buy flowers for your wife, a putter for your husband or a bottle of single-malt scotch for your boss. In the long run, this may be the best investment of all.

Depends. How much do divorce lawyers and
head-hunters charge?

Spruce
up the
house
If you're selling soon, use those five tens to increase the looks of your home. Try buying new cabinet hardware for the kitchen, flowers for the garden or a gallon or two of paint for the front door. Increased curb appeal shows you've taken care of the place, creates the impression of value -- and gets you closer to your asking price.

$500

Save
for a special event
Use that $50 to inspire yourself to start a bank account. Follow up with another $50 every month and in just a year you'll have $600 plus (plus interest) to pay for vacations or maybe a family reunion wingding. And you save more by limiting your holiday spending to cash onlyand cutting out credit card interest charges.

$600+

Stop
buying
butts
Hey, smokers -- use the money to kick the cigarette habit. Buy a four-week supply of nicotine patches by using the mail-in rebate. Save what used to be your cigarette money each day and buy another four weeks of patches to completely kick the habit. After eight weeks, you will be able to put aside a minimum of $15 a week -- a lot more if you smoke heavily.

$660+

Don't
stop
here
You've got the idea now -- $50 isn't megabucks, but it isn't chump change, either, if you use it to start incrementally saving or paying down debt. Whether it's an Education IRA for Junior or a chunk out of the Visa bill, it's up to you to make it pay off big.
A lifetime of stronger financial habits.

 

-- Updated: Dec. 5, 2002

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See Also
Tax checkup: Saving on your tax bill
Year-end planning guide
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