What to do (and ways to save) when you get a gift of cash

A mother and her teenaged daughter laugh with one another.

What do you do when you get a money gift? Learn ways to put that cash to good use.

Receiving money as a holiday gift, birthday present, or graduation send-off can be an awesome way to kick-start your savings plan. And while it might be tempting to hit your favorite online stores right away to spend your new funds, setting the money aside will help you to be able to plan for college costs or even emergencies.

Whether you’re saving for a specific expense or just want to have money for a rainy day, learning how to save money now may provide you with less worry about money while you’re a student and after. Here are some ideas to get you started:

1. Set a savings goal. Sometimes the best way to use your cash gifts is to save them. Maybe you are trying to save up for cool dorm décor your freshman year. Or maybe you want to get a head start on funding for books or tuition. Either way, setting a savings goal helps make your plans a reality. One way to do this is by opening a savings account. If you are already a Wells Fargo customer and have a savings account, you have access to My Savings Plan®, a free online financial management tool that allows you to set up target savings goals, savings amounts, and optional dates.

2. Try a no-spend challenge.We all know impulse buys aren’t great for our wallets, so why not try to avoid all unnecessary purchases? A no-spend challenge forces you to think about what you’re spending money on, like making lunch instead of buying it at a restaurant. Whatever you don’t spend, stick into your savings account.

3. Make saving automatic.There are a few ways to do this. First, if you direct deposit a regular paycheck, you can set up an automatic transfer to move a lump sum to savings. Another option is to consider something like a Way2Save® savings account. If you link your Wells Fargo checking account, every time you make a debit card purchase or pay a bill online, $1 automatically moves from your checking account to your Way2Save Savings account. You’ll be surprised how those dollars can add up over time!

4. Take advantage of free services and discount offers.Why pay for something when you can get it for free? Work your student ID as a passport to discounts and no-cost extras at museums, restaurants, retailers, and companies like cell phone providers. And don’t forget all the included goodies on campus for college students, like workout facilities, free-to-borrow ebooks and music from the library, free Wi-Fi, and professional services like job counseling or website hosting. If you can, move the money you didn’t have to spend into your savings.

Cash gifts are an awesome way to jump-start your savings whether you’re saving up for something small, like new headphones, or large, like college tuition. Either way, now that you’ve got some cash stockpiled, make sure you don’t forget to celebrate you. After all, it was a cash gift. Splurge on a fancy coffee or tickets to that movie you’ve been wanting to see all month. Save up and treat yourself (just a little!) — you deserve it!

Check out our Preparing and Paying for College Webinar Series to learn more ways to get started on your college journey.

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