So you just found out that you are getting a bonus from your employer for all of the hard work that you have accomplished throughout the year. Now it is time to figure out what to do with that bonus money. Many will have the urge to spend every penny of it on items that they do not need but some will be smart and spend it wisely. This article will give you ten tips on how to use you bonus money and be smart with it.
The total amount of debt that people are in is staggering. Your bonus may not be enough to cover the entire balance of your debt but it could work to help you pay down the balances. This will help you to save money in interest charges and to help you get out of debt sooner rather than later.
Increase Your Emergency Funds
Everyone should have an amount of money set aside for an emergency. This bonus could be added to an already existing account for this purpose or you might now have the extra money to start an emergency account. Often times you can even earn a little bit of money by using an interest bearing savings account.
Establish A College Fund
If you have children or you wish to return back to school it is important to have a college fund. Your bonus could help you to accomplish this task and give you a good cushion to start your college tuition fund after all school is expensive.
Increase Your Retirement Account
If you do not have a pending need for the money right away you can increase your amount in your retirement fund. Of course if you have a 401K there are rules about how much you can contribute per year so you will need to be aware of these rules.
Past Due Bills
Sometimes we all hit rough times when it comes to not enough money and too many bills. When we start having late payments on our bills we can start to incur additional fees. A bonus might be the perfect way to get caught up and no longer have to worry about the additional fees for late payments and high interest rates. This will also help you with your credit score.
If you do not have the need for the extra money and are feeling generous you can donate the funds to your favorite charity. There are many different contributions that are tax deductible so not only will you have a good feeling in your heart but you could be saving money on your taxes as well.
Receiving a bonus for some will often set off the trigger to invest. This should be done only if you are experienced in the investing process. You should never jump right into an investment opportunity. If you have questions you can always ask a financial advisor.
When you own your own home there is always plenty that needs to be completed. You can always use your bonus to fund the home improvements that have been waiting for a while.
If you have received a bonus then you have probably been working so hard that you deserve a vacation. Having the extra money with a bonus might be the opportunity you have been waiting for to take a vacation. Take some time off and enjoy yourself while traveling.
Another good idea to help you spend your bonus money is to decide it is time to purchase a new car. Having the bonus money might just be the down payment that is needed. Now it is time to start shopping.
Getting a bonus can be an unexpected surprise. However it is important to be smart with your money and decide how you are going to spend it wisely rather than blowing the entire amount the minute you receive it.