Gifting money for the holidays often gets a bad rap. To some it feels impersonal, uninspired, even lazy — as if the gifter couldn’t bother taking the time to consider one single present that you might appreciate.
On the contrary, those who give money are often loved ones who mean well but may not know what you actually want or need. As such, the alternative to the cash gift could be that your loved one uses the same $50 or $100 to buy you an ugly wool sweater they think would look smart on you (sorry, Aunt Beatrice).
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Instead, think of a cash gift as free money that can work for you in a way that an ugly sweater never could. And if you get more than one money envelope, even better!
With that in mind, the first thing to do is stifle any sudden urge for mindless impulse spending — be it on a shiny new tech gadget or some questionable get-rich-quick investment a relative saw on Facebook (again, sorry Aunt Beatrice).
You could, instead, put the money into a high-yield savings account, pay down debt or add it to your retirement nest egg — all smart suggestions that few would reasonably discourage.
But assuming you don’t need it urgently for any of the above, why not get creative and find other ways to turn that cash gift into more money down the road? Here, a few suggestions for putting your windfall — however big or small — to use.
1. Test the investment waters
Using a cash gift to play the stock market is certainly an option for a seasoned investor. What if, however, you’ve always been curious about investing but never had the comfort level — or disposable income — to do so? If that’s the case, there are a few different ways you could use a holiday cash windfall to give it a go, and maybe even turn a profit.
For example, fractional share trading allows you to buy portions of individual shares in companies. So you could take your holiday cash — be it $20, $50, $100 or more — and buy a percentage of a more expensive share.
According to SmartAsset,, for instance, instead of paying $100 to buy a single share of a blue-chip stock, you could consider taking that same amount and spreading it out across fractional shares in 10 different top-tier companies” (1).
Another option is Exchange-Traded Funds (ETFs) or index funds, which help mitigate risk by bundling numerous stocks and assets together. MoneyRates adds that both options “are not only more stable investments, but can also come with lower fees,” including quality investment options available for under $100 (2).
Many other possibilities exist, from crowdfunded real-estate platforms to dividend reinvestment plans (DRIPS). You just have to decide which works best for you, and then do your best to use it to multiply that holiday cash.
2. Fund your passion
As long as we’re talking about investments, why not take a chance and invest in yourself? Whether it’s buying equipment for a side hustle or taking classes to learn a new skill, putting your holiday cash toward a personal passion that could pay off is always a good bet.
Billionaire real estate investor Grant Cardone agrees, telling CNBC that “A more reliable way to get rich with just $100 is to invest it in a course, book, audio program or event that will help you improve yourself … When you invest in yourself, you can’t lose.”
In the same story, entrepreneur and author Dan Lok says that it’ll take time and patience, but “once you make enough money, you can turn your side hustle into a full-time job. Then, scale and invest your profits. That’s how you build real wealth” (3).
Read more: Robert Kiyosaki says this 1 asset will surge 400% in a year — and he begs investors not to miss its ‘explosion’
3. One person’s garage sale item is another person’s treasure
It’s a bit outside the box, but the path to your future fortune (or, at least, a decent profit) could be paved with vintage clothes, records or toys. Lots of money-minded folks swear by flipping items found at thrift shops and garage sales, which you can buy cheap with your holiday windfall and then resell online for more money to the highest bidder.
“This side hustle allows you to tap into trends, such as vintage fashion or rare collectibles, and it’s highly flexible — you can work at your own pace and reinvest profits to grow your inventory,” according to Forbes (4).
Whether it’s on Facebook Marketplace, Etsy, Craigslist, eBay, Poshmark, Depop or any of the countless other resale sites out there, you’ll also start to understand what sorts of items bring in the most profit, helping you tailor your thrift searches, target buyers and increase sales.
4. You can’t buy peace of mind … or can you?
Investments and side hustles and flipping items for profit are all fine options. But what if you just need an escape from all the noise — be it work stress or, perhaps, the political debate raging at your family’s holiday table?
Putting your holiday cash toward home workout equipment, therapy or even a mental health app subscription is an investment of a different sort, but equally as important. In the end, all the financial returns in the world don’t matter if you aren’t physically, mentally or emotionally healthy enough to enjoy them. That money envelope might just be a sign that it’s time to slow down, take a breath and reset.
5. Think about the children
Who says that you need to spend your holiday cash on yourself? If you’re a parent and don’t immediately need the money, you could put it away for your child’s future education. A 529 plan savings account, for example, allows your cash to grow tax-free and is also a great option for investing part, or all, of any holiday money the child receives as well. Down the road it could also save them from the strain of repaying costly student loan debt.
To that end, if you’re in the giving mood you could also donate your windfall to a charity that’s meaningful to you. As far as investments go, you’d be hard-pressed to find one that feels more satisfying than that.
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
SmartAsset (1); Moneyrates (2); CNBC (3); Forbes (4)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.