Got a Nice Year-End Bonus in 2023? 3 Ways to Put That Money to Good Use Now

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Extra cash is always a nice thing to have. Read on for ways to make the most of your late 2023 bonus. 

There are different benefits you might enjoy as a company employee, like paid time off, access to a retirement plan, and subsidized health insurance that makes it possible to tend to your medical needs. But another perk that workers tend to love is the year-end bonus.

In 2023, an estimated 96% of professional services companies said they intended to give out year-end bonuses, according to staffing firm Robert Half. So it may be that at this point, you’re sitting on extra money in your bank account. If so, you have plenty of options for that cash, and here are three good ones to consider.

1. Pay off your holiday credit card debt

If you recently racked up a balance on your credit cards, you’re no doubt in good company. But the longer you let that balance linger, the more interest you might accrue on it. So a really smart move for your personal finances would be to use your newfound cash to tackle your balance before it grows and costs you more money.

If you can’t pay off all your credit cards, focus on the card with the highest interest rate, and then work your way downward. You could also look at doing a balance transfer if you owe money on multiple cards and then simply use your bonus to chip away at a single balance. Even if you can’t pay it off in full, having one card to make payments on may be easier to manage.

2. Start a 2024 holiday fund now

Maybe you came close to racking up holiday debt in 2023, but narrowly managed to avoid it. If you want the upcoming holiday season to be less financially stressful, consider earmarking your year-end bonus as your 2024 holiday fund.

One thing you may want to do is open a separate savings account for 2024 holiday spending. That way, you can add to that account as your financial situation allows for, and you’ll know exactly what that money is for.

3. Take advantage of post-Christmas sales

Maybe you wanted to buy a new vacuum cleaner late last year but couldn’t quite swing it. Or maybe you were itching to upgrade your TV on Black Friday but you just didn’t have the funds because your bonus hadn’t arrived yet.

If you’re doing well enough in the savings department (meaning, you have money in the bank to cover emergency expenses) and you don’t have leftover credit card debt, then consider using your bonus to capitalize on the post-holiday sales many retailers are no doubt running right now. There’s nothing wrong with spending that money on an item that can improve your quality of life (like upgrading the TV you watch all the time).

A year-end bonus is perhaps the best holiday gift you can get. If you’re now sitting on extra money, take advantage by eliminating leftover debt from 2023, saving for the upcoming holiday season, and buying the items on your wish list you had the willpower to pass on in the absence of that extra cash.

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