What To Do With Unexpected Money

Mar 07, 2023 Personal Finances

If you’ve received a sudden windfall, avoid making hasty decisions and consider taking steps to help improve your financial wellness.

A couple playing with a baby boy. The man is kissing the baby on the cheek and the woman is smiling.

Receiving a large, unexpected sum of money is exciting, but it can also be overwhelming. Depending on where the money is coming from, it can stir up a lot of different emotions, and make you want to save or spend it a certain way.

If you find yourself in this situation, breathe, take a step back, and carefully consider your next move.

Steps To Take

Proceed With Caution

Give yourself time to weigh all your options by not rushing into anything. Start with putting your funds in a low-risk, fully liquid investment like a savings account or money market fund. This will allow you to do some research and figure out your next step while also earning dividends.

Possible Taxes

Depending on where your sudden influx of cash is coming from, you’ll want to be prepared for the possibility that Uncle Sam may want a cut. While most gifts, inheritances, and trust distributions won’t be subject to income tax, it’s always a good idea to seek advice from a professional.

Find out how much, if any, you may need to set aside for taxes and then you’ll be able to figure out what will be left over for investing, saving, or spending.

Woman laughs while holding a coffee mug and sits on a couch outside.

High-Dividend New Money Certificates

For a limited time, earn 4.50% APY* on a 19-month share certificate or 4.00% APY* on a 37-month share certificate with money new to A+FCU.

Pay Down Debt

This is a great opportunity to pay down high-interest debts or credit cards. Make a list of all your debts and include the balances and interest rates. If you’re able to take care of all your debt then congratulations, you’re done. If not, you’ll want to decide on the best repayment strategy that will not only pay off your debt quickly but also help you to save money at the same time – the snowball or stack method.

Invest In Your Future

Unless you have an urgent need for your newly acquired funds – such as medical bills – put the money in small investment accounts, high-yield accounts, and/or contribute to an IRA. Essentially, put your money somewhere it can appreciate.


Not knowing what to do with a large sum of money is a problem most, if not all, would want to have. While it’s not necessarily a bad thing to treat yourself it would be wise to have a plan in place to keep your money from disappearing as quickly as it appeared.

Savings Calculators

Don't know which savings account or certificate to open? Use our calculator to see which can earn you the best yield.

IRA Calculator

Saving for retirement is different for everyone, find out which IRA account will best fit your future needs.

Credit & Debt Calculators

Need to know how much you owe or which repayment strategy is right for you? We have a calculator for that.

A man walking through a field.
Reach Your Goals


Take advantage of free financial education from our partner, BALANCE. From confidential coaching to videos and articles, get the resources you need to help with your fiscal matters.

Related Articles

Banking on each other.
Building stronger communities.®