At their September launch event, Apple unveiled their new iPhone 7 and iPhone 7 plus to customers. With a 5.5-inch screen and increased storage capacity, Apple loyalists were excited.
But other people gasped at the price tag for the 256GB version. The new iPhone 7 is priced at just under $900, while the iPhone 7 plus is almost $1,000. Both phones cost almost as much as a good laptop.
Before rushing out to place your order, review your finances. Unless you are debt free and have a solid emergency fund, chances are there are better uses for your money.
10 smart ways to use $1,000
$1,000 is a lot of money to drop on anything, let alone a phone. If you want to make your budget go further, check out these 10 financially responsible uses for $1,000.
1. Pay down your student loans: If you’re like 43 million other Americans with student loans, you likely want to get rid of your debt quickly. And since your repayment term can be ten years or more, you face paying a lot of money in interest.
Making a $1,000 lump sum payment on your student loans can bring down your balance significantly. Plus, you’ll save money on interest over the length of your loan.
2. Decrease credit card debt: Similarly, if you have credit card debt, making a $1,000 payment can go a long way towards getting you in better financial shape.
The average credit card interest rate is around 15.00% APR. However, some cards may have an interest rate as high as 30.00% APR. If you don’t pay off your balance in full every month, your debt can balloon thanks to interest.
Using the $1,000 you would spend on a new iPhone 7 can reduce your interest and bring down your principal.
3. Maintain your car: Your car is likely one of the most expensive assets you have. And we all know car maintenance and repairs can be expensive.
But keeping up with your car’s upkeep can improve its fuel efficiency and keep it running longer. By improving your car’s lifespan, you’ll avoid having to buy a new car (and potentially an auto loan payment) later on.
Use $1,000 to get your car checked and fix any potential repairs. Getting new tires and an oil change can work wonders.
4. Get health insurance: Medical bills are often the cause of bankruptcy. While you may not think health insurance is necessary when you are young and healthy, one accident or medical emergency can wipe out your savings.
Even if you don’t go to the doctor often, you can get a catastrophic plan. This will cover your medical bills in the case of a car accident or other medical emergency. If you sign up for a plan on Healthcare.gov, you can potentially pay for six months of health insurance with $1,000.
5. Get certified: You can increase your credibility and build your professional image by adding a certification to your credentials.
For example, technology professionals can get a Microsoft Certified Systems Engineer certificate after passing a test and paying the $875 fee. Public relations professionals can also get an accreditation through the Public Relations Society of America for just $385.
Most fields have accreditation programs, which hiring managers tend to look for in candidates. Using the money you would spend on a new iPhone 7 on your credentials can improve your job prospects.
6. Catch up on retirement: If you’re like many young professionals, you may be behind on saving for retirement. Consider using a $1,000 to make a one-time contribution to a 401(k) or a Roth IRA.
Over time, your money will build thanks to compound interest. For example, if you deposit $1,000 into a retirement account earning six percent in returns, in 25 years it would be worth nearly $4,500.
7. Sign up for home security: Installing a new in-home security system ranged from $600 to $1200 in 2013, according to Safewise. However, it’s a worthwhile investment to protect yourself and your valuables.
8. Join a gym: Your health is one of the best investments you can make. Regular cardiovascular exercise and strength training can improve your blood pressure and reduce your risk of heart disease.
The average gym membership cost about $500 a year in 2014, according to Marketwatch. So with $1,000, you can also afford a few personal training sessions to kick start your gym routine.
9. Upgrade your computer: If your laptop has seen better days, investing in a new computer may be a wiser decision than buying an iPhone 7.
You can get a new 13-inch MacBook Air for around $1,000. This faster computer unit can help supercharge your side-hustle. If you write, do graphic design or online customer service, a new computer can help you earn more money.
10. Refresh your commute: Bike commuting is a healthy and environmentally-conscious alternative to driving. And, biking to work is a great way to sneak in exercise and reduce your expenses over the long-term.
Get a bike with plenty of gears to handle hilly commutes. You can also invest in a pump, lock, spare tire, tools, and a helmet. For under $1,000, biking will go a long way to improving your health and boosting your savings.
Think twice before purchasing
Whenever a new gadget hits the market, it can be tempting to pick up the latest and greatest device.
But a new iPhone 7 is a huge expense. There are plenty of other ways a $1,000 can be used to develop your career, improve your health, and increase your earnings.
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