Have you have socked away some money in the last few months, or do you have a tax return on its way to your mailbox?  Don’t let that money burn a hole in your pocket.  Here are five smart ways to turn $800 into a better money life.

Couple Holding Piggy BankStart an Emergency and Opportunity Fund
Start your Emergency and Opportunity Fund with your $800. A solid part of your money life plan is to build up three to six months of income set aside in cash in case of emergency. I also like to think that this is an opportunity fun … not for the trip to the Dominican, but as a go to place for a really solid business or personal opportunity when you have the cash flow to replace it. Don’t fall into what Gail Vaz-Oxlade calls the Easy Way Out Solution of using a line of credit as your emergency fund. Going into debt when you are in an emergency not going to help you in the long run. It is much better to have cash to deal with that emergency or take advantage of the great opportunity.

Insulate the attic
As we come out of winter it might seem like a funny time to focus on insulating the attic, but the attic is not only the coldest part of the house in the winter, it is the hottest part in the summer. Increasing your insulation to government recommended R50 or even R60 you can reduce the heat loss through your attic by 75-80% and will help keep the heat out in the summer. Putting your $800 into the attic by adding in additional insulation will save you on heating and cooling costs for years to come.

Pay down your credit card balance
If you are like many Canadians, you carry a balance on your credit card. With an average $3,573 in credit card debt, using your $800 to pay it down will cut your debt by 22% and save you $160 in interest this year. For extra protection, take that credit card out of your wallet and tuck it into your sock drawer or put it on ice. Pop your card into a container, fill it with water and store it in the freezer creating a cooling off period before your next purchase.

Get a will done
If you haven’t put together a will, it is time. Ensure that your assets go where you want them, that your kids are protected and your wishes are clearly laid out. Having a will is really important, and although it will eat up a good chunk of your $800, that investment is way less than the cost to your estate if you died without one. While you are doing your will, also complete a Power of Attorney for Health and a Power of Attorney for Finances to make sure someone you trust can help you if you are sick or injured and unable to make your own decisions.

Buy a safe for your home
Having a safe in your home for important documents, valuable items and some emergency cash is an important step in your planning. Safes provide protection from fire and water damage. If you bolt it to the floor, it is hard to walk away with in a burglury. You can buy a good quality safe for under $300. That leaves you with $500 to put into the safe in cash for emergencies.

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Personal finance expert, Karen Collacutt is founder and CEO of Make Friends with Your Money. Karen works with ambitious people who are making good money but are wondering where it all went at the end of the month. She helps her clients to get clear on their money life challenges and opportunities, matching their money to their goals. They build a plan, confidence and peace of mind around their money. Certified Money Coach and Certified Financial Planner, Karen brings over 15 years of finance and business experience to her clients. Coach, speaker, author and change catalyst for those ready to create a positive and empowered money life, Karen delivers a fresh perspective on how to make friends with your money. www.karencollacutt.com.

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