Of the 12 months in a year, December would probably be our favorite (well, aside from our birth month). Why? Aside from the actual holiday break and nonstop parties and reunions, the month of December's when we get our much-awaited 13th month pay.
However, we always have a difficult time holding on to that extra cash. We have debts and bills to pay, gifts to buy, unneccessary things to go broke for—with "we deserve this" as the lousy but effective excuse. It could get worse for those who get 14th or 15th month pay; more money, more problems, indeed!
We're getting a head start on making new resolutions for next year, and the resolve to follow one for December. We're going to treat our bounty differently; and make sure it actually lasts for longer than it usually does.
Here's what we have in mind; you can follow the tips below, and maybe make yours last until 2016 and beyond, too!
SEPARATION'S A GOOD THING, IN THIS CASE...
The first thing anyone will think of doing with that extra cash is to deposit it into a bank account—and refrain from spending some or all of it for the time being.
Sure, you can let the added dough sit in your savings account, but in a recent article in the Philippine Daily Inquirer, financial planner Randell Tiongson advises that you get that pay out of your main (payroll) account and into a different one. And it's not just because it removes the temptation to dip into those funds whenever you want to. Depositing your precious 13th month pay into a new account—preferably into "higher-yielding accounts such as time deposits or investment accounts"—will keep the money safe from random withdrawals, and grow the longer you keep your hands off it.
Even if you don't want to sign up for a time deposit or investment account, it's still important to make a clear distinction between your everyday funds and your special stash. Certain banks have options which permit them to automatically transfer a portion of your ATM-stored monthly earnings into another account for safekeeping to help you fight temptation.
DIVIDE (AND CONQUER!)
Divide the extra cash into different categories, depending on your needs and goals. If you're still in school (or enrolled in graduate studies), transfer a portion of the money to your school fund, which can cover not just part of the tuition, but also regular fees like transportation, photocopies, field trips, supplies, etc.
You can also boost your emergency fund. This monetary addition will definitely come in handy for checkups, medication, doctor's and laboratory fees, insurance payments, unexpected house, car, and equipment repairs, and other similar unforeseen expenses vital to your daily life.
Love to travel? Part of your 13th month pay can go to that dream trip of yours for 2016. You can't always get those promo fares and discounted accommodations and tours, you know. Also, visa processing fees can also be a major downer, so it's best to be prepared.
We also like having a good amount of money to contribute to our gimik fund, which covers leveled-up birthday celebrations, gatherings for special events like graduation or a job promotion, or parties in honor of your loved ones. Keep in mind that this gimik fund is off-limits for your usual nights out!
OBEY THE NUMBERS
We're speaking from the heart here—when we get a significant windfall, we tend to save it first, then get portions of it whenever we see fit. Eventually, we lose control of the spending, and give in to our want, want, WANT. Again, we pin the blame on the "we deserve it" argument. And the result's always the same: we eventually run out of cash because we dipped into our security money too damn much.
When you set a budget for your usual expenses, you stick with it, no matter what. If you've only allowed yourself to spend a certain amount on something before you got your 13th month pay, you stick with that budget. Also, think hard and consider if you really need to shell out more for something you may not honestly need right now. Your safety net doesn't and shouldn't give you the freedom to literally fall back on it whenever you want to.
SPEND TO EARN
We know it sounds contradictory, but hear us out. We're not saying you should put your entire 13th month pay into something—those new kicks, gaming console, or gadget don't count at all.
We've talked a bit about online trading in a previous feature, and surprisingly, it's not as financially prohibitive as we thought. Start with a small fraction of your pay, say a few grand, to cover the minimum investment amount by your chosen online broker. As long as you study the markets and make reasonable decisions on tested traded firms, you can make that initial investment grow at a steady pace.
You can also use a small part of your extra pay to start a sideline. Maybe you can set up an e-load business and get all your colleagues to get their prepaid mobile credits from you. Or turn your hobby into a moneymaker via workshops. Another option would be to get into the food cart business, and with a known and respected member of any of our local franchise associations. You can get more low-capital business ideas ideas from our bro site Entrepreneur Philippines.
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