While the thought of having extra money to spend over the holiday season is often a welcome one, itâ??s important to have a plan in place for spending it before it disappears into a financial dark hole.
Your bonus can go further than you think, if you are wise with it
Wikus Olivier, debt counsellor at DebtSafe, says that individuals can sometimes forget about the bigger picture when receiving their bonus, or even a â??thirteenth chequeâ??, in addition to their standard salary.
â??While this is very exciting for anyone who has been working tirelessly all year, a bonus can go a lot further than one may think, and can be utilised constructively beyond the festive season if the correct approach is taken.
Olivier offers the following advice to assist in ensuring that your year-end bonus is maximised fully:
Planning is crucial
It is important to draw up a plan of how your bonus will be used before spending it with no direction. Having a plan will allow you to map out exactly where the money will go to â?? whether towards activities, Christmas gifts, holiday trips or preservation.
Budgeting provides perspective
Not only will this allow you to allocate where your extra spend will go, but you will also be able to keep track of your spending activity, making sure that you donâ??t spend out of hand.
Itâ??s useful to bear in mind that this will be last salary you receive from your employer until the end of January â?? so it may be a good idea to allocate some budget to cover expenses until that period comes to an end.
Your bonus can aid your debt
Most working individuals have some form of debt, and since a December salary can typically double your usual monthly salary, paying off some of the debt you have accumulated can be a great way to alleviate financial stress ahead of the New Year.
This does not have to account for your entire bonus, even just a portion can be well used to pay off some – if not all – of your debt.
Investing in the bigger picture
If you are not going away over the holiday period, and do not have debt that you feel needs to be paid off, an excellent way to utilise your year-end bonus may is to invest in the long term.
Whether it be investing in your childrenâ??s education fund, topping up your own retirement fund or acquiring some healthy blue-chip shares, there is a real peace of mind when your future is a little more secured.