You’ve done it. Good for you! You now have $1,000 saved in your bank account, which must feel good. You don’t have to worry about checking your account balance all the time.
Congrats! You’re on the right path. Now it’s time to think about some longer-term goals. What do you want to accomplish next with your money? Do you need to save more? Do you want to buy a home someday? Invest?.
What’s the next step to take? What are some specific things you can do to elevate your finances?
Having $1,000 in your bank account is an amazing accomplishment. You’ve worked hard to build up this financial cushion, and now you want to make sure you use it wisely. Wherever you are in your financial journey, $1,000 can be a great stepping stone to achieving your goals if leveraged properly. Here are 10 smart money moves to consider when you’ve got an extra $1,000 in the bank:
1. Build Up Your Emergency Fund
When you have extra money, the best thing that financial experts say you should do is put it into an emergency fund. This is extra money set aside to pay for things like medical bills, car repairs, job loss, and so on. Most experts say that you should have three to six months’ worth of living costs saved up.
Use some of the $1,000 to start an emergency fund if you don’t already have one. A small emergency fund of $500 to $1,000 can be very helpful. You’ll feel better knowing you have a backup in case something goes wrong.
2. Pay Down High Interest Debt
One of the smartest things you can do is tackle any high interest debt you may have like credit cards or personal loans. High interest debt can quickly snowball, so paying it down saves you money in the long run. Make a list of debts by interest rate and focus on paying down the highest interest balances first through a strategy like the debt avalanche method.
3. Invest For Retirement
It’s never too early to start saving for retirement. The power of compound interest means that even small amounts saved in your 20s and 30s can make a big difference in the long run. Start a Roth IRA or put money into your 401k if your company offers one. Choose low-fee index funds or ETFs for broad market exposure. If you start investing early and keep at it, your money will grow for decades.
4. Invest In Yourself
Spending money to get better at things and learn new ones can help you make more money in the future. Take courses, go to seminars, buy books, or get coaching in your field with $1,000 to help your career move forward. Furthering your know-how makes you more valuable to employers. Even learning the most basic ways to handle your money can help you get more out of your savings.
5. Start An Investment Account
Once you’ve paid down debt and built savings, investing gives your money a chance to grow. Open a brokerage account and invest in stocks, bonds, mutual funds, and other assets that match your risk tolerance and time horizon. Consistently investing small amounts over many years allows compound growth to work its magic. $1,000 can be a great starting point on your investing journey.
6. Save For A Down Payment
If home ownership is on your radar, $1,000 can be a nice starter chunk for a future down payment. Come up with a savings plan to systematically build your down payment fund month to month. Set up automatic transfers to move money from checking to savings as soon as you’re paid. Aim to save 20% for a conventional loan or 3.5% – 5% for an FHA loan.
7. Fund A Car Repair Or Purchase
Big one-off expenses like car repairs or a down payment on a vehicle can quickly drain savings. Having $1,000 set aside means you won’t have to panic if your car needs new brakes or tires. And if you’re saving up to purchase a used car $1,000 is a solid start. Establish a savings timeline to reach your goal using automatic transfers cash windfalls etc.
8. Cover Emergency Pet Costs
Pet owners know vet bills and pet emergencies can get expensive Stashing $1,000 in your Pet Emergency Fund account relieves worry if your furry friend gets sick or hurt. You’ll be prepared to cover exams, medications, treatment etc without going into debt. Shoot for saving $200-500 per pet depending on their breed and health factors.
9. Fund A Vacation
After working hard and saving up $1,000, it’s nice to spend a bit treating yourself. Plan an affordable getaway to recharge and reward your fiscal discipline. All-inclusive resorts, weekend road trips, and off-season travel can limit costs. Set a vacation savings goal and timeline, then watch it grow using automatic transfers from each paycheck.
10. Celebrate Your Milestone
Reaching $1,000 in savings is an accomplishment! Before moving the money into other goals, be sure to celebrate your achievement in some small way. Treat yourself to a nice dinner out, tickets to a game, a spa day, etc. You’ve earned it! Just be sure to budget a set amount for fun rather than blowing it all.
Saving $1,000 takes discipline, and you should feel proud. With some smart planning, it can be leveraged into greater financial wins. Always pay yourself first by consistently setting aside a portion of your income, and watch your savings grow. Here’s to achieving your next monetary milestone!
6. Give Your Money a Boost and Earn 25% APY with This 13-Month CD
If your money’s just lounging in a regular savings account earning next to nothing, it’s time to give it a purpose. Think of this as a spa day for your cash—park it for a bit, and let it come back refreshed with even more.
It’s called a CD (that’s certificate of deposit, not your middle school mix) is basically a time-out for your money. You leave it alone for a set period, and the bank rewards you with a higher interest rate than your basic savings account.
Right now, Synchrony’s 13-Month CD is offering a 4.25% APY, and the best part? No minimum deposit required. So you can start with whatever you’ve got — even if it’s not a huge amount.
You won’t pay monthly fees. You don’t need to worry about losing access to your money forever. You just let it sit for 13 months and earn more than it would in most traditional accounts. It’s a low-risk, set-it-and-forget-it way to grow your savings faster — without needing to know anything about stocks, crypto, or whatever the Fed is up to.
Plus, it’s available nationwide, and the sign-up process is a breeze — people are loving it, with some sites seeing conversion rates as high as 23%.
Learn more about the Synchrony CD here. No fees. No stress. Just solid savings.
This Free App Will Give You up to $1K in Free Stock Just for Signing Up and Funding Your Account
Inflation is doing a great job of making it really difficult to buy, well… anything. And that includes stocks.
Luckily, when you open a free SoFi Invest account and fund it with at least $10, they’ll give you free stocks in return — worth up to $1,000.
With SoFi, You can buy full or fractional shares of popular stocks, plus you can invest in exchange-traded funds — or collections of stocks.
If you’re new to investing, SoFi has automated investing tools to help simplify things. Plus, they won’t charge you any SoFi management fees.
It only takes a minute to open a free account and get started. Then, once you fund it with at least $10, SoFi will reward you with your free stock — which could be worth up to $1,000.
If You Have $1000 In The Bank, DO THESE 5 Things!
FAQ
What to do after saving $1000?
One of the first things you should do with your $1,000 savings is to establish an emergency fund. Life is unpredictable, and having a safety net can help you weather unexpected expenses without resorting to debt. Aim to save at least three to six months’ living expenses in your emergency fund.
How much cash can you put in the bank without getting in trouble?
Financial institutions are required to report cash deposits of more than $10,000 in compliance with the Federal Bank Secrecy Act.
What is the smartest thing to do with $1000?
Here’s how to invest $1,000 and start growing your money today. Put it in an IRA. Get a match in your 401(k) . Have a robo-advisor invest for you. Pay down your credit card or other loan. Go super safe with a high-yield savings account. Build up a passive business. Open a 529 account. Bottom line.
Is $1000 a good emergency fund?
Saving $1000 is supposed to help people psychologically stop living paycheck-to-paycheck and learn to start saving. It also gives someone confidence to start tackling their debt. That being said, it makes a great deal of sense to have 3-6 months of salary saved.