Profitt Report: Smart ways to use your holiday bonus
This is a pricey time of year and if you’re lucky enough to receive a holiday bonus, it can be tempting to splurge even more! In fact, 63 percent of companies plan to give bonuses this year according to Accounting Principals. But Bob Wright at Complete Wealth Advisors in Flint Township said you worked for that holiday bonus, now make the holiday bonus work for you.
"Bonuses come and go. It's here this year, it may not be next year so don’t create a payment, don't put yourself into a hole that is going to make you struggle the rest of the year," said Wright.
In other words, don’t use the bonus as a down payment for a new expense such as a snowmobile, boat or other toy. Wright said, look at your emergency fund – do you have one?
"They say into every life a little rain is going to fall. You know what, life isn't perfect, life isn't fair, there will come times some rain will fall in your life, you need to prepare for that," he said.
Next, a bonus is your chance to get out of some debt.
"Use it as a way to knock off that bill that... you hate paying every month," Wright said.
Your retirement is another good place for your bonus, said Wright.
Last, if all these needs are met, the money could go towards a long-term goal: saving for your kids' college tuition, a home renovation or a trip you've always wanted to take.
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