3 Things to Do Once You've Saved $10,000

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A 2023 SecureSave survey found that 63% of Americans didn't have the cash in a savings account to cover an unplanned $500 expense. So if you're sitting on $10,000, you're in a fantastic spot.

But it's important to be strategic with your money once your savings hit $10,000. Here are some steps to take.

1. See if your emergency fund is complete

It's important to be covered for emergencies at all times. If you have $10,000 in savings, you might assume you're all set in that regard. But in some cases, $10,000 may not be enough.

Your emergency fund should be equipped to cover a minimum of three months of essential bills. If your basic expenses come to $2,500 per month, then a $10,000 savings balance is more than enough. But if you spend $4,000 a month on essentials, which may be the case if you have expensive rent or large car payments, then you should actually aim to keep saving beyond the $10,000 point until you get to at least $12,000.

2. Invest some of your money for the future

If having $10,000 in savings puts you beyond where you need to be for emergency fund purposes, then you may want to think about investing your extra cash in a brokerage account or IRA. That way, you can potentially score a much higher return on that portion of your money.

It's true that many high-yield savings accounts are paying above 4% today. But those rates are likely to start coming down soon. Plus, the stock market's average annual return over the past 50 years is 10%, which is way higher than what a savings account will pay you.

So let's say you've saved $10,000 but only need $7,500 for your emergency fund. If you were to invest the remaining $2,500 at a 10% return, in 20 years, you'd turn that sum into almost $17,000.

3. Make an investment in yourself

Once your savings reach the point where you're more than covered for emergencies, it's okay to take some of that money and use it to improve your life. And that extends to your career.

If you've been stuck in a rut at work, spend $500 of your savings on an online course that could teach you the skills you need to pursue a better job. Or, spend the $1,000 it will take to fly to a two-day conference where you can network with industry professionals and build relationships that might allow your career to really take off.

If you're happy with your job or career but feel as if aspects of your physical or mental health could improve, spend the money there. Buy a stationary bike that makes it easier to start exercising. Or, if you feel that talking to a mental health professional is necessary, use some of your savings to cover the copays (or, in the case where insurance won't pay, to cover the cost outright).

Saving $10,000 is something to celebrate. Take these steps to really get the most out of your hard work.

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