by

Taylor Kovar, CFP®

CHIEF EXECUTIVE OFFICER

Hey Taylor — My family’s got some mineral rights out in East Texas, and the royalty checks have been running bigger than usual lately. It’s more money hitting my account at once than I’ve ever dealt with, and I don’t want to blow it on stuff I’ll regret in six months. Where do I even start? — Garrett

Hey Garrett — A check that size doesn’t come around often, and it’s easy to want to spend it fast. A regular paycheck gets eaten up by gas, groceries, and bills before you even think about it. A check like this one is bigger than that, so it can help to give it a little more thought before it goes anywhere.

  1. Let it sit for a bit. It doesn’t have to be spent or invested the same week it clears. Sitting in savings for thirty days or so can give you time to think about what you actually want, instead of just what sounds good right now. It should still be earning a little interest while it’s there.
  2. Split it up. This kind of check doesn’t have to go toward just one thing. Some can pay off the truck note or a credit card, some can cover school clothes or a repair around the house that’s been put off, and some can go into retirement or savings for whenever the well slows down again. It doesn’t have to be split evenly, just have some idea of where each part is going so it doesn’t all disappear by spring.
  3. Don’t count on it happening again. Royalty checks go up and down depending on the well and the market, so it can help not to treat this one like a new normal every month. Putting some toward the mortgage, paying the truck off early, or an account that’s left alone tends to matter more in a few years than most of what gets bought on impulse.

Money like this doesn’t come with an instruction manual, and there’s no wrong amount of time to take deciding what it’s for. Thanks for the question, Garrett!