What are three good places to stash any surplus cash you may be lucky to receive?

“LUCKY to receive?” Whaaaat? Outside of the track, lotto, scratchies and an inheritance, there’s usually no luck involved in having “surplus” money!

Savings are usually the result of considerable work (your job) and sacrifice (not spending)! Cue Donna Summer: “She worked hard for the money”.

So, then, what should Gen Xers do with their surplus? That depends on how much you have.

The first place is savings. If you’ve got a mortgage, stash three months’ of income in your offset account. If you don’t, use a high-interest online savings account.

If your mortgage still feels monstrous – which only you can determine – then pay down your mortgage, preferably into the redraw account so you can get it back if required.

If those two buckets are full enough, start investing in you … and to your better future.

This is your longer-term investment plan. Shares and/or property. Directing surplus savings to investments will eventually provide income for your future.

In fact, it shouldn’t just be “surplus cash” that goes to investing. As George S Clason, author of The Richest Man in Babylon, called it, pay yourself first.

The first thing you should do with your pay is to contribute to your investments. Only then should you spend the remainder on life’s necessities. Grow your future earnings first. It has to be a priority.

Certainly, for Xers at least, there’s no need to follow Kerrin’s advice for her Retirees and buy a funeral plan! We’ve still got a few good years not to have to worry about that … if we’re “lucky”.

Bruce Brammall is the principal adviser with Bruce Brammall Financial (www.brucebrammall.com.au) and author of Mortgages Made Easy.