Wise things to do with your end-of-year bonus

The festive season has officially arrived with all its glittering 
decorations and Christmas tunes. For many homeowners around the 
country, that means some serious spending is just around the corner. 
Those of us lucky enough to get end-of-year bonuses may have already 
earmarked them for gift giving and seasonal festivities, but there 
could be an even more rewarding way to put our hard-earned money to 
work.

"It's so easy to get caught up in the holiday madness and wake up in 
January with a bank account emptier than the Grinch's Christmas 
stocking," says Tony Clarke, MD of the Rawson Property Group. "After 
a long, hard year, we need to let loose a little, and nobody expects 
monk-like behaviour over December, but a little bit of awareness and 
future planning can make those pay cheques go so much further."

1. Give yourself the gift of financial freedom

One of the easiest ways to increase the impact of your end-of-year 
bonus as a homeowner is to put that extra money straight into your 
bond. Sure, it doesn't sound very festive, but it can literally 
increase the value of that money by as much as five times. That 
sounds like a pretty amazing holiday miracle, if you ask us.

"The sooner you put a lump sum into your bond, the bigger its impact," 
says Clarke, "so this is a particularly good idea for new homeowners 
with a lot of time still left on their loan. For example, putting a 
R10 000 bonus into a recently opened bond of R1 million can reduce the 
total cost by almost R65 000. That's a lot of money to give up for a 
new gadget or gift that'll be forgotten in a year's time."

Work out how much an additional payment can save you here.

2. Spoil yourself with home improvements

For those of us who can't resist treating ourselves to a little spoiling 
over the holidays, Clarke suggests looking into home improvements that 
deliver instant gratification and long-term value at the same time.

"With summer in full swing, it's the ideal time to think about adding a 
built-in braai, or putting a pergola over your patio to create the 
perfect outdoor chill spot," he says. "Improvements like this not only 
enhance your lifestyle, they can also boost your resale value quite a bit 
- not to mention making festive entertaining much more enjoyable for 
everyone involved."

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As a bonus, a comfy entertainment area can make a great alternative for 
watching the game with friends without having to worry about a scary bar 
tab or overpriced snacks.

"Eating and drinking out over the holidays can get very pricey very quickly," 
says Clarke, "so being able to entertain at home can end up saving you a 
lot down the line."

3. Plan your gifting in advance

For many of us, this time of year is less about spoiling ourselves and more 
about treating our loved ones. Sadly, seasonal gifts often add up to a little 
more than we were planning to spend. To help curb this tendency, Clarke 
suggests putting together a clear budget for gifting, and opting for smaller, 
more meaningful presents that don't necessarily come with a high price tag.

"Picking - and sticking to - a budget is really key," he says, "but that 
gets a lot harder to do if you've left your shopping to the last minute. 
Why not take advantage of all the end-of-year markets and sales to pick up 
unique and meaningful gifts for your loved ones, and put the days of expensive 
panic-buys behind you."

If you're keen to go one step further, try hand making a few present this year, 
or gift personal experiences like a romantic picnic in the park. Remember, 
memories last far longer than almost any other gift, and don't have to cost 
an arm and a leg.

SOURCE : Property24