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It's not everyday you find yourself with $100,000 to invest or spend. So when you do, use it wisely. And if you have a more modest sum at your disposal, check out these smart ideas for $1,000 or $10,000.
Launch Your Dream
Having a hundred grand for a startup is sweet. "The average small business starts with less than $10,000," says small-business expert Susan Solovic. The typical time to turn a profit is two years. With a fairly uncomplicated, low-overhead business like consulting, you can deploy your 100K like this while you wait: As much as $5,000 for upfront legal help; $12,000 for an accountant (over two years); the bulk of the rest for living expenses and a reserve for a 30- to 90-day gap between invoices and payments.
Open Your House to Strangers
An extra room is great for an older parent someday—or rent-paying tourists now (if you live in a vacation spot and can list on Airbnb). "Make sure it has a separate entry and feels like its own space," says Florida architect Bud Dietrich. Figure $150 to $200 a square foot if you're remodeling or converting a basement or garage; $200 to $300 if adding on. For a 450-square-foot space, that's $90,000, leaving $10,000 to furnish it (don't skimp if you want vacationers).
Hold Out for Richer Social Security
Worried you'll run out of money over a long life? Delay collecting Social Security for as long as you can. Say you'd get $27,000 a year claiming at age 66. If instead you live off $108,000 of savings until 70, your initial benefit jumps to nearly $36,000.
Get In On Today's Rental-Market Boom
Median rents are up 4.2% over the past year, vs. a 3% gain for home prices. Want in? For the best mortgage rate as a landlord, real estate author Leonard Baron suggests putting 25% down. That's $75,000 on a $300,000 home, plus $5,000 for closing costs. Hold back cash to spruce up the place ($12,000) and cover costs when you're out a renter ($8,000).
Three affordable cities where rents are growing fast:
|CITY||MEDIAN MONTHLY RENT||GROWTH 2014–15||MEDIAN HOME PRICE|
Notes: Medians for metro areas; 12-month growth through July. Source: Zillow
Take Advantage of Low-Cost Help
This year Vanguard opened its Personal Advisor Services to investors with as little as $50,000. You can work with a financial pro (by phone) for an unusually low 0.3% of assets a year. A heavy reliance on technology keeps costs down. Learn more about the new wave of web-based investment advice here.
Upgrade the Family Fleet
Why spend $100,000 on one luxury car—or even one Tesla Model S—when everyone in the family can get a fresh set of wheels? Here's how Kelley Blue Book's Nerad would fill a three-car garage with that budget:
1. Upgrade the Main Ride: Cadillac ATS ($41,000). A luxury sedan that's a good value, sporting an up-to-date style that competes with imports.
2. Haul the Whole Family: Chevrolet Tahoe LT ($47,000). An exceptionally roomy and comfortable SUV. With 18 mpg, the fuel economy is decent for a large SUV.
3. Put Teens in a Boring-But-Safe Used Model: 2010 Honda Civic ($10,000): Strong crash ratings should make you feel better about giving teens keys to their own car.
Leave a Legacy with Your IRA
If you won't spend your entire IRA (average size: $96,300), name a charity as the beneficiary. Your heirs would owe income taxes on withdrawals, but a charity gets all the money tax-free, notes estate-planning attorney Tracy Craig.
Earn Your Degree
Don't think you can keep the four-year cost of college under $100,000 without hefty financial aid? How about living at home to save? With many top urban colleges, total tuition and commuting costs come in under six figures. For example, at the University of California at Berkeley, No. 9 on Money's best college value rankings, you can walk away with a degree for an estimated $63,500, assuming average institutional financial aid and the typical time to a degree. That includes your commuting costs. And since 74% of students live off campus, you're less likely to feel left out of the dorm scene. Other stand-out campuses where you can earn a sub-$100,000 degree include the University of Washington, Seattle ($76,500), Baruch College of the City University of New York ($55,000), and the University of Pittsburgh ($92,000). Check out all 10 top commuter colleges here.
Read More: Find the best college for your student—and your wallet.