Lucky enough to get a bonus? ‘Spend it wisely’ – debt review company
DebtSafe suggested making wise choices when you receive your bonus.
DebtSafe, a debt review company reminded South Africans that January 2024 can be a very long month if you do not consider using your ‘little bit extra’ wisely.
They highlighted that you can either be a spender, a saver, or a user and asked which one you would rather be.
• The risky spender
It’s always fun to do a bit of splurging but, as you know, life is expensive, and economic times are currently tough for South Africans.
The company therefore recommended that you only spend a little this December (and then only if you can really afford it). Rather spend a few bucks on that holiday that you need to pay off, instead of being a risky spender by spending all your bonus money on unnecessary, expensive items.
• The cautious saver
If you are in a position to save your entire bonus or have money left from your tax refund amount (after your necessary debt payments etc.), why don’t you save it?
Tuck your entire bonus or a part of your tax return into your rainy day/ emergency fund. Life happens and you never know when your ‘little bit extra’ savings may come in handy, especially when you really need it.
• The wise user
The company recommended using a bonus productively by paying off excessive debt. If you relate to this, there are two things that you can do:
1. You can either make use of the so-called snowball effect by paying off your smallest debt first (like a clothing account); or
2. You can use the avalanche method – where you use the money towards paying off the debt with the highest interest rate first, like your credit card.
