While many folks are thinking of what things they can buy and spend their bonuses on, here are a few ways that you can put your Christmas bonus to good use.
Spending Your Christmas Bonus Wisely
Pay your debts
One of the things that you should prioritize at any point in your life is to be debt-free. Making yourself free from any debt as you close this year is a great way to start the new year.
When paying off your debts, categorize them, so you know which ones to prioritize. You must pay off interest-bearing debts such as credit cards and bank loans. Then pay off your car and home loans, followed by the money you owe to your family and friends.
The goal in doing this is to cut off debts that accumulate interest because they are the ones that do the most damage to your bank account.
Build an emergency fund
Another way to put your holiday bonus to good use is to pay yourself first by putting your money in your emergency funds.
This is especially helpful when a person becomes jobless, whether by choice or by circumstance (just like what happened to millions of people due to the pandemic).
If you don’t have an emergency fund yet, we strongly recommend building one soon. It doesn’t matter how much you put in. What’s important is you get started on it as soon as you can. Make sure you place it in a separate account from your savings, so you’re not tempted to use it.
Put it away in your savings
If you already have an emergency fund in place and you’re satisfied with the amount in it, you can add your bonus to your regular savings account.
What makes savings account different from an emergency fund, you may ask? An emergency fund is a certain amount of liquid money that is set aside only for emergencies. It is meant to be used for and on legitimate emergency cases.
Savings, on the other hand, is money that is set aside for a rainy day but not necessarily an emergency. It could be used as a downpayment for a car, children’s tuition fees for the following school year, or other expenses. While it’s not exactly an emergency fund, it should still be used with great caution and discipline.
Invest part or all of it
You worked hard the entire year to earn money and provide for your family. It’s about time to make your money work for you. Instead of putting your money in a bank, you can opt to put it where it will grow and be more useful to you in the future.
Put your money in investments that have long-term rewards, such as mutual funds, bonds, stocks, insurance, and other investments that you think are worth taking (after, of course, much scrutiny). The best tip we can give you is to keep your investments diverse to reduce the volatility of your investment portfolio.
Be a channel of blessing to others
Christmas time is the season for giving. Your holiday bonus is, in truth, from the generosity of your employers. While you may feel like you earned it for all the hours you spent toiling and laboring at work, it is actually a generous deed extended your way to show gratitude and appreciation for what you do.
In other countries, like the Philippines and Austria, the law requires employers to give their workers an additional full month’s pay — thirteenth-month salary — during the holidays. In our case, it is totally up to our employer’s discretion and generosity.
It may be a good idea to spread the love by giving it freely to other people in your community. After all, Christmas is really about giving from the heart. If you want to be a channel of blessing to other people but you have no idea where to give your money, reach out to organizations and foundations. They can help direct your money where it’s needed most.
Reward all your hard work
This list won’t be complete if we don’t include something for your enjoyment and pleasure. Now is a good time to reward yourself for all the hard work you’ve done throughout the year.
Buy yourself a gadget. Get a makeover. Spend a portion of your bonus on yourself, but don’t use it all on trivial things. Keep in mind the other things we put on this list. Be responsible with your bonus but don’t forget to take care of yourself, too.
Before you make a list of things to buy for yourself this Christmas, consider the things we put on this list to help you become a better steward of not just your bonus but of your money.