Not knowing what to do with a large sum of money is the issue that probably everyone wants to experience. Holiday bonuses are coming and it is extremely important to have a plan that details what to do with it. Remember, no matter how much money you receive as a windfall, if you don't use it wisely, you run the risk of losing it all. Here are some tips that you can work on to help you manage your finances better, and do your planning smartly.
Pay your debts first
Utilizing some of your cash to lower or pay off high-interest debt, such as credit card debt or other debts with double-digit interest rates, makes a lot of sense if you're using your present salary to pay it off. You'll lessen your monthly payment burden and the accompanying opportunity expenses by paying them off. You'll be able to pursue more lucrative chances as a result of this.
Create a good cash flow
Making a good cash flow ahead is a great concept for what to do with the extra money that you have. Making a plan for your use of the money before you receive it is also an excellent place to start.
Invest on properties
Make a down payment on a house or piece of property instead of squandering money on rent. If possible, put down 20% of your mortgage, and you’ll be way ahead in the long run. If you already own a home, this could be a fantastic opportunity to secure a rental property.
Make your money work for you
If you are liquid enough and does not need the cash immediately, and you’re looking to grow your money, you may consider putting it in various investment opportunities like Unit Investment Trust funds (UITFs). UITFs are professionally selected fixed portfolios that allow investors to know what securities are held within the portfolio. It offers the convenience and diversification of owning a portfolio of securities in a packaged investment with a stated investment objective.