It's not unrealistic for you to ponder the possibility of a
modest cash windfall in your lifetime. It could be an unusually
large bonus, profit from the sale of your business, or an
inheritance. For sake of discussion, let us assume that you
didn't plan on this money coming and let's work with an
amount of $50,000.
What to do with this windfall? Here are a few suggestions to
consider:
1. Pay down your mortgage
Pay down the principal amount of your mortgage as soon as you
can do so without paying a penalty. Your net worth goes up by the
amount of the payment and you save money every month from now until
your mortgage is paid off. Those savings can be invested in some
other part of your financial plan and go on to make more money for
years. Over a long enough time horizon, it's likely your
windfall will more than double.
