What to do with extra monthly and bonus cash flow?

I’m still trying to decide what I will do with the extra monthly and bonus cash flow once I’ve fully re-paid myself. I do, at this point, have almost a year to think about that and if I don’t come up with any great ideas, I will direct the money into an “other” savings account until I come up with a good idea. Some ideas that I am tossing around at the moment:

  1. Split the money up three ways into investments, pre-paying the mortgage, and saving for a 20% down payment on a house
  2. Split the money up 50/50 into investments and pre-paying the mortgage
  3. Split the money up 50/50 into pre-paying the mortgage and saving for a 20% down payment on a house
  4. Invest all of the money
  5. Use all of the money to pre-pay the mortgage and pay it off really quickly

Right now, I prefer the first option since it still allows the extra funds to be diverted back to mortgage pre-payments or investments at any point. The fifth option isn’t very flexible and the fourth option is the riskiest.

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4 thoughts on “What to do with extra monthly and bonus cash flow?

    • That was my plan when I was looking at 3 bedroom townhouses, but now that I’m buying a condo, I think I’m leaning towards #1 so that I have some more flexibility when I’m looking to buy a house/bigger place.

    • It’s hard when they’re really all good decisions and it isn’t obvious which one is the “best” one, isn’t it? Good luck figuring out what to do with yours! :)

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