Maybe you’ve just received your big bonus or maybe you’ve had a windfall, with that extra cash in hand now, what do you do with it? Instead of just spending lavishly on big ticket item, why not make your money work even harder for you?
This is especially true if you’re currently in debt, the monthly interest incurred by your debt will build up over time, and by the time you realize it might be too much for you to pay! So start by paying off the one with the highest interest rate and slowly work your way down. This way you’ll get out of debt sooner as well as paying the least amount of interest possible.
If you’re thinking of buying an expensive item, you can do so by singling it out to a separate account. This way you can include in your monthly budget and deposit a small amount into it every month. Pretty soon it will be filled and your dreams can be fulfilled, this is a smarter way to buy expensive items, rather than getting in debt and buying it when you can not really afford it just yet.
You should also try to aim to save up at least 3-6 months of your monthly income in the scenario that you lose your job. This emergency fund account should be left untouched at all times, when you have that sort of money, move them into an equity fund or even fixed deposit to collect interest for you, at the same time knowing that you can be covered if your get retrenched.
One expense that catch most people off guard is medical expense. We’ll never know when we need it and when we do, it might be too expensive! Therefore it is wise to either have an account just for that, or buy insurance coverage that will help take care of any medical needs in the future. Some insurance company even offer a chance to invest, just be sure that your primary goal is to buy medical coverage.
Lastly, you want to make sure you’re saving for your retirement funds as well, this fund will grow overtime as you deposit into it every month. When it is at a substantial amount, you can squeeze even more from it by investing in something that will give you a generous amount of returns without too much risks.
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