Earnest Stories highlights the money experiences of individual investors, experts, and non-investors alike. Watch the full episode here.
Managing money can be a challenge year-round, but it gets even trickier around the holidays with trips, gifts, family reunions, and year-end parties to prepare for.
In this episode, participants shared how they plan for holiday expenses while still making room for savings and investments when their Christmas bonus comes.
How do you keep your holiday spending in check?
Even with the cushion that a holiday bonus brings, impulse spending and a lack of planning can easily damage your finances.
Martin, an account manager, believes self-control can be more important than having a plan when it comes to managing a bonus.
“For my spending habits, it’s more of willpower than it is keeping a system,” he said. “Kasi at the end of the day, even if you have a system, kung hindi mo naman kayang panindigan, wala rin.”
Elli, a bank employee, steers clear of mindless spending by giving herself time to think before she buys. “I always ask myself, ‘Do I really need this? Can I afford it? Will it really be worth it?’”
It can greatly help to identify your emotional and situational spending triggers to avoid making impulse purchases and help good money habits stick.
Another way to keep from spending your bonus all at once is to save for holiday expenses before the season starts.
“I have a separate budget talaga for all holiday-related spending,” answered Jenni, a researcher. “So that’s how I also discipline myself na parang, oh, eto lang yung inallocate mo for this time of the year. You stay within these limits.”
Noah, a portfolio manager, uses the same approach when budgeting for gifts, which he has identified as his biggest holiday expense.
“I usually allocate a budget per person. I make sure I have the money for this by November [so] I have enough time to buy presents.”
What do you think of giving cash gifts?
Most participants said they wouldn’t mind receiving cash gifts, but giving is a different story. They believed that while cash can be convenient and useful, it can be impersonal.
“Personally, I’d be okay with just cash pero of course if it’s [a gift for] someone near and dear to me, I would’ve liked it if it was more personalized,” Martin said.
Jenni noted relationship dynamics matter when deciding whether to give cash gifts.
“I think it also depends on your relationship with the recipient,” she said. “For example, I wanna gift my parents something, I don’t think cash is an appropriate gift for them.”
Elli, on the other hand, sees cash gifts as a practical option for adult recipients. “For me, it’s practical. Mas alam na ng pagbibigyan ko yung mas gusto nilang bilhin. Especially for the grown-ups, ‘di ba?”
“Although I think it’s less personal, I think it’s thoughtful, nonetheless,” added Elli.
Noah prefers a different way to give someone the freedom to choose their own gift. “If I don’t know what the person likes [specifically], I’d rather give a gift card instead of straight up cash.”
How will you maximize your Christmas bonus?
Before bonus season arrives, Elli already knows where she’ll allocate money – toward holiday spending, savings, and investments.
“For me, saving money is not growing money so there should be a balance,” added Elli, further sharing that she plans to invest in low-risk products like time deposits as a Conservative investor.
Knowing your risk profile is important when choosing investments. You’ll avoid taking on more risk than you can handle by using your risk profile as guide.
As a newbie investor, Martin plans to put money in a beginner-friendly product. “I wanna invest it in UITFs (Unit Investment Trust Funds) because they’re really accessible for the common man and they’re very affordable as well.”
For Jenni, an experienced investor, building a strong portfolio is the next step. “At this point in my life, I think I’ve already set the kinds of investments that I want.”
Her current strategy is to keep adding to her existing investments, especially when bonuses come. The amount she adds to different investments depend on her target portfolio allocation.
Jenni also shared the importance of revisiting her strategy when the need arises. “In the future, when I hit another milestone in life, ‘pag malaki talaga yung change in priorities, that’s when I’ll reassess.”
The trick for maximizing a bonus, Jenni believes, is to not see the huge sum as “a sudden rush of blessings” that you can spend however you want.
“I’ll be like, no, I already planned for this. This is where it’s gonna go.”
