YOU may not be certain of the amount that our employers will give you for a Christmas bonus, but, once there is money heading your way, we should consider investing the amount in a financial product which will deliver increasing value or returns.
Putting your money to work, so that it can grow, is something that you should be doing every month, or every time you are paid for a service or collect your salary.
This is even more true when the money that flows into your account, or that is handed to you is an unexpected or special amount which is over and above what you earn on a regular basis.
Here are five things you can do with your Christmas bonus or any unexpected funds you receive in the future:
• Make a new beginning by opening an investment account. You can name it if you wish. It could be savings towards the deposit on a new home, or to invest in a business idea you are considering.
• You can also start an emergency fund if you don’t have one as yet. The general rule of thumb is that you should have 3-6 months of salary saved to cover emergencies. We have seen how particularly useful this principle is during the financial challenges posed by the COVID pandemic.
• Start an opportunities fund. This is money you continue to grow until there is an investment opportunity. For example an IPO, real estate or some other project that could enrich your life.
• Add to your retirement savings. The more you set aside for your retirement, the bigger the payout will be when you are no longer working. Not to worry if you are not already apart of an approved pension scheme. Individual Retirement Accounts are a great way to take your retirement planning into your own hands. Ask your Scotia Advisor about the ScotiaBRIDGE to learn how you can boost these savings this Christmas and onward in the future.
• Invest in company stocks which have a good growth profile with strategic plans that will result in added shareholder value. Discuss with your broker.
• Invest in Mutual Funds. These are among the products which have been performing above market since the onset of Covid-19. A managed mutual fund like Scotiabank Mutual Funds, is a pool of money from many investors which is used to invest in stocks or bonds. It offers several benefits of balanced growth and lower investments risks.
• Another option is an exchange-traded index fund. ETFs or index funds are a basket of stocks and/or bonds, designed to track some broader index (like the S&P 500 or the NASDAQ, …….