If you receive a 13^th cheque or an end-of-year bonus, you’ll be mentally preparing for it already. We have a tendency to spend our additional cash frivolously over the holiday season, but there are ways that you can be responsible with this added bonus and use it to your advantage in the long run. Here are a few tips to help you manage your bonus responsibly.

1. Have A Plan Of Action

You should already be managing to balance your income and expenditure in any given month, so your bonus should be additional income that is not essentially required. If that is the case, then you need to have a plan of action for what you are going to do with it before it arrives in your bank account. Chances are, if it is deposited into your account and you haven’t yet decided what to do with it, you will start dipping into it and use it up.

Determine where it is needed most.

• Are you paying off a house? Perhaps it will be a booster payment that will bring your monthly repayments down. Or it can be used to decrease your capital owing
• Looking to buy a car? It could be the deposit that will help you get a better deal on reduced monthly repayments
• Are you in need of any major appliances that could streamline your life a bit? Dishwashers and washing machines save a lot of time and energy that could be used up in better ways

2. Pay Off Debt

If you are battling to pay off debt that has been lingering for a long time, use this opportunity to pay it off. It might not seem like a very fun way to spend your bonus, but you will be going into the New Year with a smile on your face due to being debt free. Consolidate outstanding amounts and pay them off in one go; or choose a particular account that has a high interest rate and zero it out.

3. Split It Up Into Percentages

Instead of saying you will spend R1000, donate R1000 and save R1000, you can rather split your bonus up into percentages and decided what to do with each part. Perhaps you invest 40% of it and save the rest for holiday spending. Whatever you do, if you don’t really need the money for anything, a large percentage of it should be invested.

4. Invest In Your Future

As many as 67% of South Africans know little or nothing about retirement funds, as according to 10X Investments’ second annual Retirement Reality Report. For those who do understand or know about the need for retirement savings, there are many who don’t have the means to save for this. If you are one of those people, put this money into a retirement savings plan that will return greater rewards when you really need them. There are multiple options that can work for you and your circumstances. Simply speak to your Employee Wellbeing Programme consultant who can steer you in the direction of a suitable option.

5. Have Some Fun

After dividing your bonus into percentages, keep one small amount for you and some fun over the holidays, even if it’s only 10% or 20%. Once you’ve allocated the rest of it responsibly, you can also have some fun as a payback. Do something you don’t normally do, pay for your family to see a show, go to a water park, or take your loved one out for a night on the town. It’s important to be able to reap some rewards for all your hard-earned work, that is also a major contributing factor to your personal wellbeing.

Resources: https://www.iol.co.za/; https://www.10x.co.za/

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