11 Ways to Spend Your Holiday Bonus

If your employer surprised you with a holiday bonus this year, you might be at a loss of how to spend it. Since a year-end bonus is not guaranteed, you probably didn’t include it in your monthly budget. Check out these 11 ideas:

1. Add it to your retirement account.
2. Pay off credit card debt or student loans.
3. Add it to your emergency savings fund. Read also: Do I Need an Emergency Fund?
4. Start a 529 savings plan for your children’s education.
5. Save it for a bigger purchase, like a house or car.
6. Enroll in a course that will help further your career. Read also: Take Control of Your Own Career Development
7. Donate it to your favorite charity.
8. Add it to your Health Savings Account (HSA).
9. Finish that home improvement project you’ve been putting off.
10. Make a lump sum payment on your mortgage.
11. Splurge on a massage or nice dinner to reward yourself for all your hard work.

Tips for spending your holiday bonus

Your check might be burning a hole in your pocket. Depending on how you spend it, it could make a significant impact on your financial health.

• Create a budget – When you receive your bonus check, create a budget for it, so you avoid spending it all on something you don’t need just because you have some extra cash. By creating a budget, you can help relieve some of the stress and fatigue you might feel at the end of the year if you’re pinching pennies and trying to make ends meet.
• Prioritize your spending – When you’re creating your budget, determine where the money would be most useful to you. For example, if you have a large balance on your credit cards, it might make the most sense to pay off some of your debt so you can improve your credit score.
• Spend some money on yourself – It’s easy to burn out if you’re trying to meet your financial goals, so splurge a little to reward yourself. You’ve earned it!