Have you been blessed by Goddess Lakshmi this Diwali, with a Diwali bonus? If so, your mind must be busy plotting the various ways you could spend it, isn’t it? But beware, lest you fall into the trap of spending additional income that comes your way impulsively, and lamenting later that you should have been more careful!
It would be prudent to spend your Diwali bonus smartly, ensuring that you reap some rewards in the future. The additional income might seem bountiful when you receive it, but with careless spending, it can get exhausted very soon. Listed below are a few smart ways to invest and utilize your Diwali bonus.
You may have a housing loan or a car loan or owe someone money. In such cases, with loans that accrue interest, it is better to pay off a lump sum when you have additional funds in hand. This will reduce your financial burden, propel you towards your financial goal of being debt-free and help you in saving more in the future.
Pay Credit Card Bills:
Paying off credit card bills will help you save money and escape from the high-interest rates and additional charges. Never pay only the minimum amounts due on your credit card bills. This is another step towards being debt-free too. Learn to make use of your credit card billing cycle and plan your credit card usage accordingly.
Purchase Insurance Cover:
You must protect yourself and your family with adequate life insurance and medical insurance cover. Today’s high-risk lifestyle brings with it uncertainties and being underinsured or uninsured is a mistake that can cost you and your family dearly. Your Diwali bonus could be used to purchase new insurance that will protect you and your family in the future.
Buy Gold ETFs:
Most people purchase gold and diamond jewellery during Dhanteras and Diwali. This Diwali, don’t fall into the sentimental trap to buy physical gold. The additional making charges that you pay on jewellery will be lost when you want to sell it. While it is definitely gratifying and brings pleasure at the moment, it might remain unused most of the time afterward. Jewellery also requires secure storage space. Therefore, instead of spending money on jewellery, invest in Gold ETFs (Exchange Traded Funds) with your Diwali bonus.
Plan For Savings:
Ensure that you plan for proper savings for the future. Instead of searching for last-minute tax savings options, invest in instruments eligible for 80C deduction to meet your tax savings Periodically saving for any contingency is a good habit. This Diwali bonus might help you add to those funds. Setting aside funds for a financially secure retired life will help you be independent at the time. Do not mix up your retirement savings with your emergency funds and even with the savings for your children. It is important to plan these separately and to start early, without delay. What better time than Diwali, when you have got your Diwali bonus, for some additional savings!
Plan Your Travel:
If you want to travel or go on a vacation with your family, plan ahead. There would be good travel deals and holiday packages by travel companies as well as airlines being advertised right before the festival season. Your Diwali bonus can be used to fulfil this without worrying about additional credit card bills or loans towards vacations.
Shop For Your Diwali Needs Sensibly:
While it is natural to be tempted into the various advertisement offers and glitzy product promotions, keep a tight watch on your budget. Prepare a detailed shopping list after careful consideration, of only the things that you and your family would actually ‘need,’ and is not a ‘want.’ All impulsive purchases, while providing instant gratification, can cause regret at the sight of future credit card bills. Coming to that, make sure you shop with cash or your debit card, instead of accruing credit card bills that will come to plague you after a joyous Diwali celebration. While shopping for gifts also, stick to your pre-decided budget. Have a look at some additional Tips to Have a Great Diwali.
An ideal approach would be to plan all of the above in advance – what you would like to do with your Diwali bonus when you receive it. Hope these tips and suggestions will help you spend your Diwali bonus wisely and achieve financial prosperity in the future. Wishing you and your family a very Happy Diwali filled with lights and joy of this festive season.