Christmas is fast approaching. It is the time of the year wherein you will receive your 13th-month pay and other year-end bonuses. However, it is also the time of the year wherein temptations are everywhere. Signages displaying “SALE”, “50 % OFF” and many more.
If you do not have self-discipline and a proper mindset, chances are all of your bonuses will be gone in a flash. That is why it is better to have a plan on how are you going to spend your money wisely. Try to consider these 10 smart ways on how to spend your 13th-month pay and other year-end bonuses.
10 Smart Ways On How To Spend Your 13th-Month Pay and Other Year-End Bonuses
1.) Debt Payment
The sooner you can eliminate debt, the better. Use some portion of your 13th-month pay to reduce your debt significantly. You can save money from interest expenses too.
Debt, if left unattended, will slowly consume and control you. Not only your finances but the whole aspect of your life. And eliminating debt is also a good start to control your financial aspect and towards achieving your financial freedom.
2.) Build Your Emergency Fund
If you do not have yet an emergency fund, now is the right time to start building it. With the bonuses you received, it can be a decent amount to start with. As a rule of thumb, it should be equivalent to three to six months of your monthly expenses or income. Whichever you are comfortable with and believe that can help you in times of emergency.
Having an emergency fund is a must if you want to become financially independent. It will serve as a cushion when an unexpected situation arises. You can start by opening a separate savings account in a bank that is accessible to you. And make sure that you use your money intended for emergency purposes only (house repair, job loss, healthcare).
3.) Avail An Insurance Policy
Thinking of the best gift you can give to yourself and to your family? Avail an insurance policy whether its a health insurance or life insurance or both.
Most people think that availing one is just an additional cost. However, wealthy people think the other way round. They consider insurance as a must-have.
Availing long-term healthcare is one way of preparing for your future needs. When you become old, you do not want to be a liability for your children since they also have their own family to take care of. On the other hand, your life insurance can be a substitute for your family source of income in case something will happen to you especially if you are the sole breadwinner.
4.) Invest In Yourself
As they say, investing in yourself is the best investment you can make. Whether it is for your health, for your personal growth, for honing your skills and talent or for learning something new.
You can buy books related to finances and personal development. I am sure you can learn a lot from reading. Or set aside some money for enrolling yourself into enhancing your skills or developing a new one.
As long as it can make you better and can improve yourself, all the expenses you made will be worth it.
5.) Start Your Own Business
You are dreaming of having your own business, why not use your bonuses as your start-up capital. Make your dream business come true whether it is an online business, a distributor, a buy and sell or a cafe.
Start working on it. You will never know, it can be a decent source of additional income too. And possibly, you can quit your day job in the future and focus on it. But of course, before launching it, you need to do some research and come up with a business plan.
6.) Educational Fund
If you already have your own family, you can add it to your child’s educational fund. Start funding your child’s education as early as possible since the cost of education is increasing.
7.) Start Investing
It is inevitable that we become old. As early as now, we should start preparing for our future. We cannot afford to work until we get very old. Instead of working in order to make money, start making your money do the work for your future financial needs.
The essential ingredient of investing is time. Start as early as you can so that you can enjoy life later on. Life is too short to just spend it on doing things that you do not really love at all.
Investing in yourself can be a good step. Learn the different types of investment. Understand it and find out what suits your financial needs and to your personality. You should not invest immediately without studying it first.
Investing in a mutual fund can be a good start if you do not have enough time to study the technicalities and to personally manage your investment.
8.) Treat Your Family
After those hard works and sacrifices, it is time to spend together with your family. Why not treat them? Go on a vacation or give them some presents. Seeing your family member’s smiles and happiness will be really worth it.
9.) Give to others
When you are already financially stable, why not share your blessings with others. Donate it to your charity of choice where you believe and support the advocacy.
I really believed that the more you give the more you will receive. It is also a good way of showing gratitude for all the blessings that you received. After all, Christmas is a time of sharing and giving.
10.) Treat Yourself
You deserve some treat after overcoming those challenges in life whether it is physically, emotionally, spiritually and even financially. Reward yourself for overpowering those challenges and for continuing fighting for your dreams despite the hardships.
But before treating yourself, make sure that it will not drain your finances and plan it carefully. Set how much you should spend on rewarding yourself.
I understand that during this time of the year, there are a lot of expenditures. Family gatherings and other reunions are being held. Getting together with your friends and classmates. Giving gifts to your loved ones and many more.
However, it does not mean that you should spend a lot of money that your financial status will be at risk. You should learn to spend it wisely. Prioritize what really matters and make most of the value of your money. The key is balance.
So, those are the ways on how to spend your 13th-month pay and other year-end bonuses. How about you, do you any idea other ideas on how to spend your bonuses? Share it in the comment section below!
Merry Christmas and a Happy New Year!
