7 ways to use your bonus to change your financial destiny

Image: Instagram
Image: Instagram

What if your 2017 end-of-year bonus could start you on a new financial path so that you begin the New Year empowered, in control of your finances (rather than the other way around)?  You may think that this is a pipe dream but by becoming more aware of your options when it comes to how you spend your money (and how or if you save it), it is possible to re-write your financial destiny.

“There’s a shopping culture, where we are convinced that we’ll be happier if we accumulate more and more things,” says Wealth Coach, Lianne Lutz of Women’s Wealth.  “Without realising it, we are often driven to spend our extra money on items rather than using it strategically to lesson our financial burden and even to start creating financial independence,” says Lianne who believes in a balanced approach, where money is allocated to spending within your means, accompanied by a focus on saving and reducing debt.

So, instead of fighting the challenge of juggling different temptations with responsibilities and needs, here are 6 strategies for optimising your end of year bonus in order to re-set your financial destiny:

Delayed gratification

It is a natural human instinct to want things now, rather than putting them off for later.  This has an evolutionary bias from pre-historic man, when we were exposed to environments where we had to capitalise on the moment when it came to finding food or water.  As a result, we often have a challenging inherent urge to have immediate satisfaction which today is translated as buying that expensive dress or going on that amazing holiday. 

“However, if you want to create an empowered financial lifestyle, you need to ignore the pull of shiny objects which will take you further away from financial stability.  Change your perception of not giving into buying from self-denial to nurturing your financial foundation so that you can create the starting point to financial security,” explains Lianne.


Before you even have your bonus, it is a good idea to decide what you are going to do with it.  “Setting up parameters means that you will be less tempted to spend your money on items which may not benefit you in the long run,” says Women’s Wealth PDM graduate, Kerri Lutz who advocates allocating your bonus to different categories of 40% towards your debts, 20% towards savings, 20% towards spending. 

“In this way, you get to have the best of all worlds – saving, consolidating debt and spoiling yourself, without falling victim to impulsive buying.  Most importantly, you can enjoy your money without feeling guilty,” states Kerri.

Reduce Debt 

“Interest on debt eats up your money.  It’s time to claim this money for yourself.  Just think what you can do if you could rather save this money rather than pay it out for your debt each month,” says Lianne.

Put your bonus into paying off as much as possible of your credit cards and store cards.  As soon as your card is paid off, cut it up and cancel the account.  Rather put the money you were paying into the card into a savings plan which can be used to pay for clothes or other items.

Cover your short-term expenses

What are your expenses for 2018?  Think of expenses like school fees, uniforms or household expenses such as electricity or plumbing. Take 5 – 10% of your bonus which you’ve allocated to savings and establish an emergency savings account where you have quick access to your money.  Emergencies are inevitable and this savings account can act as a buffer to prevent you from having to dip into your monthly income.

Pace your spending

It can be exciting to suddenly have extra cash, but you need to use it wisely and slowly. Most of us find January the longest month of the year, waiting for our salary.  But if we pace our spending over December and January, we can still enjoy ourselves without having the stress of waiting for January to end,” says Kerri who suggests the strategy of deciding in advance how you are going to use your spending money.  “Create a budget of what you are going to do with this money.  It doesn’t have to be set in stone but, just by allocating a certain amount each day or each week can help keep you on track.

Another idea is when it comes to giving presents, decide as a family on the limit to spend on gifts.  “Stick to this, no matter how challenging it may be in the short-term.  Empower yourself by rather thinking of the gift of financial independence which can be achieved through wise spending,” says Kerri.

Invest in yourself

Nurturing yourself means investing in yourself.  Investments can be anything from a new dress or haircut to enrolling in a course or signing up for a gym or yoga classes. 

Even if you have debt, you need some form of balance, giving yourself a treat.  Self-care is priority.  This boosts our self-confidence, which is essential for us to be able to establish and enjoy the life we wan.

Savings Plan

If you don’t have any debt, then consider setting up an investment portfolio.  Once you are in such a position, then it would be advisable to set up a meeting to discuss your financial goals and establish an investment vehicle most suitable for you.

“Remember, it’s your money, so make it work for you.  Your bonus is a result of your time and effort over the past year.  It’s very tempting to want to go shopping when you suddenly have extra money. 

Use your bonus as an opportunity to lay the foundation for a new financial lifestyle, in which you start ending your debt, opening up a path to grow your money through savings and investments. Start to create an empowered life of financial independence in which you are free from the financial anxiety.  It’s time. You deserve it! “concludes the Women’s Wealth advisor.

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