Unexpected windfalls or bonuses can make you feel like you just won the lottery! But before you get too carried away living in luxury, let’s talk about six other (more practical) things you could—and probably should—do with your bonus.
Pay Off Debt
One of the best things you can do with surprise cash is pay off lingering debts. Even if you only use a portion of your bonus, you’re guaranteed to feel a lot lighter. Plus, you’ll save money on interest, meaning you won’t have to spend nearly as much on monthly payments—and no dodging any pesky collection calls, either. You should plan this out accordingly as well.
List your debts from smallest to largest, or throw some cash at those with the highest interest rates first.
Read More: 6 Tried-And-True Strategies for Paying Off Debt Fast
Start or Boost Your Emergency Fund
An emergency fund is arguably the number one financial parachute that everyone should have. Life is full of surprises, like your bonus. But it’s also full of surprises, like getting a bonus and then your car breaking down two weeks later. Set some of your bonus aside for starting or adding to an emergency fund to make an otherwise stressful day a lot more bearable.
Read More: How To Create an Emergency Fund (In 4 Steps)
Invest in Yourself
Use a portion of your bonus to invest in your personal or professional development. Take that online course you’ve been eyeing, attend a workshop, or even sign up for a yoga retreat (because who doesn’t want to learn how to bend like a pretzel?). Investing in yourself pays the best dividends; it empowers you to be your best, most realized self. And that person is a lot more likely to be smart and responsible with their money, not to mention make more of it!
Plan for Future Goals
What does future you really want? Before you pick out your silver caviar spoon, remember what you’re working toward. Maybe it’s saving for a new home, finally going on that European vacation, or just paying down your student loans. Whatever your plans are, a bonus is a fantastic source of fuel for these goals—make it a point to pay into them before you overspend on the present with too many presents.
Celebrate! Responsibly
You deserve to celebrate! Treat yourself to a nice dinner, buy that fancy gadget you’ve had your eye on, or finally get those shoes that make you feel like a million bucks (hint: they should not cost a million bucks). Indulge, but don’t go overboard; there are many other ways to utilize this money to set you up for success in the future.
Treat Your Loved Ones
Now that you’re feeling generous, consider treating your friends or family. Whether it’s a dinner out, a small gift, or a fun outing, sharing your good fortune can strengthen your relationships. You don’t have to go too lavish. Most people would be happy enough with a nice dinner to say thanks or let them know you care about them. Anything more could be expensive overkill.
Read More:
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