How to decide what to do with spare money

First, make sure the basics are covered

Got a bit of money left after payday? Before looking for an investment, check the bills still to come, any costly debt and how much emergency cash you’ve got. Sometimes sorting those basics is more useful than opening a trading account.

Give every goal a date

Write down what the money is for and roughly when you'll need it. A car purchase next year is different from retirement in thirty years. A short deadline makes a big market fall harder to recover from before you need the money.

Use these five checks

1. Time: when do you need the money?
2. Cash access: can you get it when you need it?
3. Loss: how much could you lose, including borrowed money?
4. Costs: what are the fees, interest, tax and ongoing expenses?
5. Work: how much effort does it need? Property and business ownership aren't hands-off.

Match the research to the goal

Short-term cash: research savings accounts, term deposits and conditions. Longer-term investing: learn about diversified ETFs, bonds, property and how your super is invested. More income now: look at your skills, extra work or a side business. None of these are automatic winners.

Super is a way to invest for retirement with specific tax and access rules. ETFs are an investment structure. You can hold shares, bonds and other assets through either route depending on the options available.

A small decision worksheet

Write down the amount you have spare, the goal, the deadline and what could go wrong if you lost part of it. Then make a shortlist of two realistic choices. For each, check access, risk, costs, tax and how much effort it takes. For example, comparing an emergency savings account with a share ETF is really a comparison of two very different jobs for money.

There is nothing wrong with finishing this exercise and deciding to wait while you learn more.

What to do this week

1. Check next month's bills and build or review your cash buffer.
2. Choose one goal and give it a rough date.
3. Read one official source about the option you want to understand.
4. Write down the biggest risk and all the costs before committing money.

You don't need to decide everything today. A clear reason for your next step is enough.