It is the Christmas season once again. The most awaited merry and jolly time of the year because of the festivities, get-togethers, and is also the time when we receive our Christmas Bonus.
What do you plan to do with it?
Shopping or add to cart then checkout? Easy! How about upgrading to that trending flip android or tri camera smartphone or splurge on a 60-inch TV for your home theatre? Awesome, right!? But if you are serious about your family’s or your financial stability or maybe helping others, look no further. After all, realizing the need to save your extra cash doesn’t mean that you can’t spend money this gift-giving season.
Here are smart tips on how to save and spend your Christmas bonus.
Tips on How to Save Your Christmas Bonus
Pay Yourself First
This is the foundation when it comes to personal finance. Paying oneself means saving a portion of our money before spending it. This is something we can also apply the whole year-round, but how does it go? As a general guideline, you can use the 50/20/30 Rule. 50 percent of your income goes to your daily essential needs, 20 percent goes to your savings and 30 percent goes to your wants. This only serves as your guide, you may adjust it depending on what is comfortable for you or what fits your monthly income. Automating your savings, especially if you are a busy person and do not want to line up in the bank or payment centers, is a great way to make sure you have a regular and steady flow and contribution to your savings.
Invest in Peace of Mind
This pandemic has taught us that it is best to be prepared for uncertain times since we are unaware of how, when, or how long unforeseen events last.
We have seen families emotionally and financially suffer because of hospitalization or the sudden death of loved ones; we don’t want this to happen to us. To be prepared, we can start by investing or boosting our emergency fund somewhere that is liquid but earns a higher interest rate than regular bank savings account like Money Market Funds or other short-term time deposits.
Ideally, an emergency fund must be at least times six (6) of your monthly living expenses. If you are yet to save, you may start with at least three (3) months’ worth of expenses first. Keep it to a separate account to avoid being tempted to use it for regular or unnecessary expenses.
Grow Your Existing Business
Do you have an existing business? Why not use your extra funds to fill up your store by replenishing your stocks, adding new items, or enhancing your line of products? You may use your Christmas bonus in buying additional and necessary equipment for your store. For example, a new mixer or other baking tools if you’re into baking goodies, good lighting tools, or a camera if you are into selling your products live online.
If you are yet to open a new business, you may research what fits your interest and passion or checkout ideas available online.
Make Your Christmas Bonus Work for You
You have been working hard all year round to earn your Christmas Bonus, now is the time to let it work for your whole lifetime. There are many investment options to choose from depending on your budget, financial status, and risks tolerance. Some of these include but are not limited to Time Deposits, Stocks, Mutual Funds, Bonds, Endowment Plans, and Real Estate.
Tips on How to Spend Your Christmas Bonus
Pay Off or Minimize Your Debt
Yes, yes, we know this isn’t the most inviting way to spend your Christmas bonus, but believe us when we say that it is one of the smartest. The rule is to list down all our debts from smallest to largest. Then use your extra holiday income to pay off the loan or debt with the highest interest first, so you can save on interest charges.
Keep in mind that it is a not-so-good idea to start the next year with debts, so better use the extra money you have and pay off your loans or credit card debts.
Treat Your Family (only)
Summer vacation is many months away, but it’s never too early to start saving.
Due to the pandemic, it’s been months (or even years) since you and your family went out of town. Instead of rushing and splurging on more unnecessary stuff, why not book that getaway you’ve been wanting for years and treat yourself and your loved ones to a little R&R.
Got kids? It won’t hurt if you ask the Grannies or relatives for some time to book a quiet staycation a few hours away from home. After all, spending time for your marriage is always a good investment. Also, studies show that experiences make us happier than things anyway.
Share it with Others or Donate
Okay, relax! We are not asking you to donate your entire Christmas bonus. Once you have already treated or given gifts to yourself, friends, and love ones, ask this question: who else could you help in this season of giving? Share some of your extra income by donating to charities or organizations that fight for causes that you support.
