FinanceCents.com

Ah, the world financial markets are rockin’ and shakin’ and you have no idea what next year brings. Osama bin Laden is still at large (and so is Mas Selamat) and really, there’s no reason to be happy. But what you do know is you’re getting your year-end bonus real soon!

So being the nice guys we are, we’ll tell you how NOT to spend it.

Whatttttttttt?!?!!?!!?

Ok ok, fine. Spend it. Go buy yourself something nice. An iPhone, or that cool headphones you’ve been wanting. Don’t spend it ALL though! Just something to reward yourself for your hard work and make the idea of saving the rest a lot more acceptable. Don’t forget a good, hearty meal. ;)

Here’s what to do with the rest of it:

Get rid of those crappy debts and loans

Yeap, especially those with interest of above 8% per annum. Like your credit card balance, or your credit line loan. With 18-24% interest per annum being charged to you, I would really say getting rid of this is possibly like making an instant ROI of 18-24% p.a. off your bonus. And trust me, being debt-free (other than the more-or-less obligatory mortgage which can’t be helped) is an endeavour as worthy as any other.

Invest it, or save it?

Times are bad indeed. So given this financial turmoil, should I invest or save? That really depends on how secure you think your job is and how much emergency funds you already have on hand.

If your job’s relatively secure, and you can survive on your salary pretty well even with a pay cut, by all means invest. My personal guess is that the market is bottoming out (even though it might take the whole of 2009 just to get back to an slight upward trend), it’s a good time to start using dollar-cost averaging in a systematic investment scheme.

That’s assuming, of course, that you already have your 6-9 months of emergency funds nicely tucked in a short-term savings account somewhere. If not, just save the money, for crying out loud.

So, what are you going to do with your bonus? Leave a comment!

Other stuff you’ll be interested in

• Hide all your cash under your pillow
• Don’t let credit cards rob you!
• Manage your money like a sushi chef
• Markets falling? No problem, throw in more money!
• Here’s how that Ah Beng became richer than you