One of the merriest things about Christmas time is the Christmas Bonuseseses! We, employees a.k.a slaves of the corporate world waited for it all year-long. In a few days, hard work and consumed time and energy will finally pay off, at least for most of you. In luckiest cases, it can be a windfall in the coming weeks, for all you know. When you’re on the “unlucky” side, you’ll still receive the mandatory 13th-month pay. I hope you knew and followed through one of the most brilliant tips on Personal Finance and that is to forget about bonuses until you receive them. Meaning, from the very beginning you are not supposed to include it in your budget nor you should earmark it for any debt or expenses. Assuming you remembered and followed this rule, the next question would be what will you do once you receive all those money this December?
I bet you bet I’ll say invest it. Of course, I’d say that. That’s the most natural and smartest advice. But if you already have a hefty savings account covering your emergency fund and working insurances, would it still be wise to put it there or in a Time Deposit? I highly think not. I suggest you explore other instruments. Why not open a mutual fund account or start investing in the stock market? Read about the basics of investing in mutual funds and the stock market here. As for me, I’m constantly beefing up our stock market portfolio and UITF (similar to Mutual Funds). Although this year, I have a different kind of investment in mind.
I know I said you shouldn’t have allotted your bonus to pay off your debts but in the event that you really have huge debts such as a house loan, you may do so for the following reasons:
- You can save money by paying your debts as they will no longer incur interests.
- Peace of mind. I don’t know about you but isn’t it nicer to sleep without debts in your dreams?
- Your reputation and credibility are at stake. You don’t want to ruin your name, your profession or career and your relationships and friendships only because of debts getting out of your hands, do you? If you’re a good payer, it is highly that a person or even an institution such as a bank or credit company will approve your next loan, just in case you need to.
- It will teach you lessons in life. It will make you more responsible on your next decisions, well hopefully.
I would suggest though that if you have more than one loan, pay first the one with the highest interest. Also, if your debt is only one and/or not too big including the interest rate, I would suggest you pay only a portion of it and invest the other portion. Why? Because it will form a good habit of investing. You’ll regret not being able to invest all your money so next time you’ll be mindful of your borrowings. Also, I personally believe that paying debts with interests is painful and therefore if it’s painful, your brain will automatically avoid that circumstance. If it’s a painful experience, you would not want it to happen again, right? You’ll take an extra effort to not go through the debts again.
I said awhile ago that I have a different kind of investment in mind this year. I have already mentioned it in my previous Money Bliss post
, in no. 5. I intend to invest in myself this year. I want to improve myself. I guess that’s what being 30 is all about. I am currently enrolled in a class and I have attended an SEO (Search Engine Optimization) seminar and guess what? I do not intend to stop, not anytime soon, at least. After my classes, I am scheduled to enroll for a Distance Learning course. You too can do the same on whatever it is that interests you. If you’re good at something, why not go beyond being good? If you want to learn something, then do so. Turning your passions into profit is not a bad idea. If you enjoy something, then explore further. If you need and want to improve your craft and/or your image (yes, image counts!), bonus is the best source for those. Enroll in classes, attend seminars, conferences and conventions. Sign up for workshops. Anything! The Internet has a gazillion of opportunities. Modesty aside, I think I’m good at finding these things on the Internet. You may drop me an e-mail for a query. I also think I’m beginning to be an advocate of self-development and improvement.
This last idea may be against the norms. My friend usually tells me that I always think differently. At first, I did not like the idea. I tried to blend in. But I guess, a Sagittarius simply cannot contain his/her thoughts. You can use a portion of your bonus to spoil your loved ones through gifts and treats. Many financial advisers and planners would tell you to control your expenses. And, they are absolutely correct. I totally agree. However, some of the advice which I read are not applicable or acceptable to me. Let me site an example to clarify my point. One financial planner said that one should skip socialization during the accumulation or saving stage up to the building stage. Me, I’d rather invest in people and relationships even without the monetary returns (bonus na ‘pag meron!). Meaning, I would still meet a friend despite she won’t give me business leads or business-relevant connections. Sure I could wait until I’m financially free before I get a social life but the thing about life is that, you do not own its time. Today you’re alive, tomorrow you may no longer be around.
Another example, financial planners tell us to analyze our monthly budget and be vigilant about the expenses that are not programmed pointing out to the small but frequent treats we give our loved ones. In my case, I love making the people I love happy. It makes me happy too. It’s a fulfillment for me, to be able to make the people I work hard for happy. It never has to be grand. When my family asks for a cake, an ice cream, a pizza or a delivery for lunch or dinner on weekdays, even if it’s not on my budget, I’ll give it to them. Because that’s how I show my love to the people who are the reasons why I work hard. To each his own I guess. I just put it here for all the people out there who, like me, finds pleasure in spoiling their loved ones. Maybe not in the grandest of ways but in the littlest of things. Don’t spend everything naman ha! Keep someting pa rin.
Did you get an idea on what to do with your Christmas Bonus this year? I certainly hope so. But first, let’s pray we receive them the soonest!