2021 Graduation Gifts: Save, Spend or Invest? How To Make Smart Decisions

Last Updated on June 1, 2021

MyFinancialTimes is a reader-centric site. We may receive compensation from the products and services we mention or recommend in this story, but the opinions are the author's own. Remuneration may impact where offers appear. We may not include all available products or offerings. To learn more you can visit our advertising policy and editorial policy.

Graduation Gifts in 2021 don’t have to go down the drain on the latest smartphone! Instead, that cash can help you save for your future. Here’s whether to save, spend, or invest those hefty checks.

One-Time Cash Flow

Cap and gowns can mean freedom, excitement, and parties. But they can also mean big decisions. Grad-gifts are starting to pour in left and right, and it’s going to take a lot of self-control not to spend all that money at once.

Whether it’s $100 or $1,000 stuffed in envelopes; remind yourself that it is a one-time deal. Once that money’s gone, it’s gone for good. Unless you’re set with a six-figure job right out of school, you may want to reconsider those new shoes or designer headphones.

Save It!

Rainy days can happen any day. Starting a rainy day account now could save you from dipping into debt in the future. Emergency car payments, doctor bills, or layoffs could pop up, and it may be smart to start a savings account dedicated to those unwanted but likely instances.

Stuff that money away so you won’t be tempted to use it, whether in a saving account or a shoebox tucked under your bed. When a problem arises, having an extra thousand could save you big time. Your graduation gifts could be the start of that life-saving stack of bills.

Invest It!

Getting started in the stock market doesn’t require a massive initial investment. Instead, you can start playing with $1000, $500, or even just $100. Instead of wasting your graduation gifts right off the bat, investing it can reap big rewards, meaning more shoes, tech supplies, or vacation spending in the future.

Quick Tips:

  • Learn the market from Marketwatch or the News to get a grasp on how to make the most of your dough.
  • Download a stock market app like Public or Robinhood and invest the graduation gifts in stocks of your choice.
  • Steadily invest more one-time gifts to expand your portfolio and start racking in more money for your future.

Penny Stocks can come in bulk, even if you don’t have a huge budget. $1000 can turn into huge money if a cheap stock grows. These investments are risky, but if you’re patient and the company grows, your one-time graduation gifts could grow a few zeroes.

Cryptocurrency is another extremely volatile but cheap way to expand your investment prospects. Whether your eye is on the big cryptos or altcoins, investing in digital currency can potentially expand your bank account.

Pay Off Debt

With a nice enough grad gift you may be able to start chipping away at your student loans. Every little bit helps – especially if you’ve got a hundred other financial responsibilities to worry about. Making a habit of knocking out debt with one-time gifts can mean less financial strain later. 

Fuel Retirement Funds

It’s never too early to start saving for retirement. Really!

Your graduation gifts can fund a quick, one-time payment that could transform by the time you’re ready to retire. With smart long-term investments like mutual funds or 401Ks, retirement can be more than getting out of work: It could become sipping drinks beachside because you were smart with your cash!

Fuel Your Passion

Graduation marks a transitional period in a person’s life, one that can be particularly stressful. Using graduation gifts to fuel your passion could transform the next stage of your life into a time worth remembering.

Memberships can be expensive. However, most gyms or classes give discounts for buying in bulk. If you’re passionate about something, like yoga, dance, or pumping iron, buying yourself a year’s membership can help fill your time with something that makes you happy.

Certifications can also be a good idea, especially if you’re heading into the first stage of your career. The investment may be hefty at first, but will last with you for a lifetime, enhancing your marketability in the workforce.

Vacations may seem like the opposite of a good investment. However, if you’ve just graduated and are worried about your future, that stress can eat you up for the long haul. Taking a break and traveling can do great things for your mental health. You’ll likely return refreshed, recharged, and ready to take on your future.