Every year many employees and workers happily anticipate finally receiving their yearly bonuses. Be it variable pay, profit share, Christmas bonus, 13th-month or even 14th-month pay. Rather than wait for the new year to “get started” with one’s new year’s resolution on personal finance, investments and the like, December is probably the best time to do it due to the increase in one’s spending power.
“The wise have wealth and luxury, but fools spend whatever they get.” (Proverbs 21:20, NLT)
Here are some ways for you to spend it and begin the journey in investing in yourself!
Invest in yourself — Knowledge is power and education is the most powerful weapon you have to change the world, your own world! You can get started by gaining education or through short courses. Learning can be online or done in real classrooms, but you will surely learn something new.
Pay all your debts — Sure you can pay it later on but this will restrict your spending in many ways, even hindering your plans (travel, dream house, car…etc.). Pay all forms if possible: credit cards, 5-6, personal loans and the like.
Create an emergency fund — It’s better to be prepared even if nothing happens than to be not prepared when financial disaster strikes! One needs to establish a fund equivalent to six months of your monthly expenses.
Get a life insurance — You do not buy this for yourself but for those who you leave behind. Besides, you need only one (sufficient enough of course) for you have a family that needs to be protected in case you die unexpectedly, suddencritical illness or you figured in an accident.
Have health coverage —“Mahal Magkasakit” that is a truth that we can all agree. Make sure you are contributing to Philhealth, get some health insurance or even an HMO. Health is wealth after all.
Start that retirement fund – once all if not most of the above are achieve, then one can confidently dive into the world of investments and begin by getting into the stock market (upcoming IPOs) or even through pooled funds (UITFs, Mutual Funds, VULs..etc..).
Begin on important repairs – we are a country that gets hit with an average of 20 storms or typhoons every year. Shelter is one of our basic needs and if repairs are needed, it should be done while there is no storms of natural disasters. Taking preventive measures or maintenance can save you a lot money.
Bless others through Gift giving —Just because I mentioned the above that you can be “stingy” during December. It is the season for giving and thanksgiving. You can start by donating to a local kids charity, church or perhaps even volunteer your time in a non-profit organization.
Travel/vacation fund — They say that traveling helps us grow and open our minds to many different perspectives. But of course, don’tspend all your bonus into this.
Hire a financial planner — Hiring a registered financial planner, will enable you to save a lot of time, trial and errors as you are getting help based from another’s experience and expertise, to help youcreate a plan, manage the risks involved and minimize the mistakes you may encounter in investing.
The writer is an RFP® - registered financial planner of RFP PH, Licensed Real Estate Broker and Director of CERTA, Inc., a family estate planning and investment advisory firm. To know more, please visit www.certa.ph
Originally Published in Philstar - The Freeman Newspaper last December 13, 2016.