How Best to Use Your Bonus

Your bonus is in and the timing couldn’t be more perfect. But before you blow it all in one go, take a moment to think carefully about how best to use it.

It lands with a thump, that extra whack of money in your bank account. Your bonus is in and the timing couldn’t be more perfect. There’s a holiday planned, Christmas presents to buy, and, after the year that you’ve had, you deserve a little spoiling too. But before you blow it all in one go, take a moment to think carefully about how you can really make your bonus work for you. It could be the very thing that helps you start next year on a strong financial footing.

Here are a few things to keep in mind when your bank account is feeling fit and healthy:

  • Re-evaluate your financial priorities

Take a look at that (mental or literal) list you made at the beginning of the year in which you set your financial intentions. Did you want to end the year debt-free? Did you want to put a down payment on your first car? Did you manage to achieve those goals? If not, your bonus might help you tick off one (or part of one) of the items on your list before the year is out.

  • Take a long, hard look at your debt

It’s a good idea to divide your bonus into percentages and commit to servicing some of your debt with one of these portions. How much you siphon off will depend on the debt you have, but consider using as much as 40%. Always pay off the debt with the highest interest first. If your credit cards and store cards are in good shape, put a little bit extra into your larger, long-term loans like your bond or your car.

  • Save, save, save

You knew this was coming and you know it’s a good idea, too. Putting some of your bonus away can be a lifesaver when you slam your tyres into an awful pothole or when an unexpected post-Christmas pudding dental bill lands on your lap. You might also think about adding to your retirement annuity or putting some money in your dedicated travel or new dishwasher fund.

  • Indulge in that well-deserved spoiling

A bonus is a treat. It can feel a bit like winning the lotto, especially if it’s not something you receive every year. And choosing only to make responsible decisions with it can take some of the pleasure out of the experience. Take a percentage to do something that gives you joy, such as a spa day or a trip to a theme park with your family.

Whatever you do, don’t make your year-end financial decisions based on the fact that your bonus is going to hit your account. Things go wrong all the time, and if it doesn’t land and you’ve pre-empted bonus-related purchases, you could find yourself in a sticky situation. Be patient and, when it does arrive, take your time working out how to spend it wisely.


Choosing the right medical aid is no joke, but we’ll leave you smiling.