This is the best past of the year, when we receive our appraisals and yearly bonus or incentives. Our hard work has finally paid off. Most of us, before receiving the bonus amount, start planning on how we are going to use this bonus? We plan for vacations, buying big ticket items for home, gifts for loved ones, or something that we couldn’t afford earlier for kids. But we never think to make use of this perk to repay our debts, or increase our savings and investments!
Bonus money is an add on to your regular income. It should not be considered as a fun money that can be spent on gifts or entertainment. Rather, direct the additional cash to give a shape to your financial stature.
Moneymindz presents you with the best tips to make correct decisions with the bonus earned and how to wisely invest it to meet your goals faster. First things first.
1. Clear Your Debt:
Owing money is not a great sign of financial security. Specially, when interest rates are eating away the earnings. The first priority is to clear the debts with the extra money you received. Think of paying the debts like credit card bill payment, car loan or a personal loan, at the earliest. A debt free life should be the first priority as with time your debt increases with interest rates and we never gain freedom to save and invest our money in right things.
2. Build an Emergency Fund:
For leading a secure financial life it is important to build an emergency fund that is kept aside to meet the unforeseen circumstances. God forbid if we encounter a sudden emergency which demands money, how well we cope up with the situation depends on many things and one of them is having enough cash in hand. Instead for looking around for help, have a fund to meet the immediate need. You then, do not have to owe to anybody.
3. Invest For Your Child’s Education:
Child education is every parent’s most important goal. Why not use this bonus amount in building corpus for your kids education? Start with a small investment today and allow the money grow. With time in hand, the power of compounding earns interest on interest. Best thing to do is to opt for a systematic investment planning with little investments on regular basis. The yield received from investments should beat the inflation rate and meet the future demands.
4. Get Closer to Your Dream Home:
We dream of buying a house but fail to realise it soon! If dreaming to own a house, direct the bonus amount to the fund needed to accumulate for down payment. This way you can approach your dream sooner than estimated.
5. Add to Your Retirement Fund:
Preparation for retirement is never too early. In fact, the sooner you begin, the better it is for leading an independent retired life. To lead a dignified retired life, start little investments in mutual funds through a well-diversified portfolio.
For an expert advice on the right investment choices and holistic financial planning, approach online Financial Advisory Moneymindz. Get your personalized portfolio and build a golden future.
In conclusion, bonus is not fun amount that comes in just for entertainment. Wise investments of the same amount helps build a bright financial future. So, take wise decision with your hard-earnings.