The festival of Diwali is here, and some of us might be looking forward to a Diwali Bonus. At the same time, it might be tempting to spend all the bonus on impulse purchases or a few Diwali parties; however, a financially wise decision in moments like these can go a long way in taking you closer to your financial goals.
Let us look at some ways you can spend your Diwali bonus for the best deal.
- Build an Emergency Fund - This is the first fund you should focus on if you are a salaried employee and have family responsibilities. Your emergency fund should ideally have at least six months of your income. You should park your money for the emergency fund in liquid and safe instruments like FD or RD. A Diwali bonus could be an excellent way to start building this fund.
- Get Insurance - If you do not have health or medical insurance, then this is the fund that you should save to pay the premiums for the insurance cover you choose. The Covid-19 pandemic has made many of us realize the importance of having insurance, and it is highly recommended.
- Plan a Vacation - If you have been regular with saving for your goals and safety, you might want to spend this money on leisure activities. You could use this money to plan a trip you have been postponing for a while and maybe even use the Diwali vacations to go on the same.
- Buy Gold ETF - Gold is an asset that becomes extremely popular during the festival of Dhanteras and Diwali. You might be able to get a decent offer on a Gold purchase or gold-related scheme with your bank. You can even invest in a Gold ETF as it is both a good investment and considered auspicious during the Diwali festival season.
- Pay your Loan - You could use the bonus to pay back a loan quicker. This will not only improve your financial security but also reflect well on your credit score. You will also save a lot of money on the interest you will save by paying your loan sooner.
- Save for a Big-Ticket Purchase - If you have been saving money for some house renovation or a down payment for a new car, this is the money that you should use to fast track your journey to that goal. If you do not have anything planned from beforehand, you can save this money in a separate fund for big-ticket purchases. You should keep putting some money in this fund later on and use it for a dream purchase once you have enough.
- Invest in Yourself - One of the best ways to spend the Diwali Bonus is to invest in oneself. You could learn a new skill or take a course that you have always wanted to. You could buy your favourite gym equipment or a kindle if you enjoy reading. Investing in yourself is the best investment you will make in your lifetime.