Smart Money Moves to Make With Your End-of-Year Bonus

While the end of the year can be financially draining due to the holidays, many of us may have an end-of-year bonus to look forward to. Whether your job generally provides one due to performance or a bonus comes completely as a surprise, receiving the extra money can feel nice. People spend this two ways, with smart money moves or the not so smart.

You may not want to just blow the extra money on holiday gifts or other splurges. Here are 6 smart money moves to make with your end-of-year bonus.

Save It

Sure, this may be a boring option but it’s also one of the best ones. By the end of the year, a lot has probably happened and your savings account could likely need a boost.

It’s important to keep several months of expenses saved in your emergency fund at all times. While this may sound somewhat daunting to you, you can always take advantage of windfalls like an end-of-year bonus to help boost your savings.

Plus, saving money should always be your first instinct. If you get a bonus and are unsure of how you want to use it, put it in your savings account in the meantime while you decide.

Pay Off Debt

It’s always a good idea to pay off debt with any windfalls that you may receive. Debt can literally sabotage your current and future goals because monthly payments can eat up a ton of your income.

Paying off your debt is easier said than done, but it helps when you can have some extra money to throw toward it. One year, I received a sizeable tax refund and put the entire thing toward my car loan. Yes, I probably would have enjoyed doing something else with the money but I also really wanted to get rid of the loan.

Putting an unexpected windfall toward your debt can give you that extra motivation and push you need to keep going.

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Beef Up Your Retirement Contributions

We all want to have the option to retire someday. Even if you enjoy working and never want to stop, there is no way of telling the future and you’ll need to have a retirement plan in place.

Consider investing your work bonus by contributing some of it to your retirement fund. If you have a traditional or Roth IRA, you can currently contribute up to $6,000 per year and you have until April to do it.

Ideally, you’d want to set aside around $500 per month to contribute to your IRA. If you fall behind throughout the year, your end of year bonus can help you reach your savings goal.

Fund a Large Purchase

If I receive an end-of-year bonus from clients this year, I will definitely consider putting it toward some important house projects I have. As a homeowner, there is never a shortage of house projects to do so any extra money can help with this.

Your bonus money could also be put to good use as a down payment for a large item or service that you need. Maybe you’ve been putting off getting new brakes on your car or paying for some home repairs. Use your work bonus wisely si you can cross one more thing off your list.

Invest In Yourself

Investing in yourself is often a good idea. We often spend money freely to invest in other people and things, but it’s important to prioritize yourself as well. One of the best smart money moves you can make with your end-of-year bonus is to put it toward something that will help you improve your life.

You can invest in a course or training that will help you gain more marketable skills to increase your income. You could also invest in a health and nutrition program or some therapy for your mental health.

Think about all those times you push off your needs and do something beneficial for yourself for a change. Using a windfall like a work bonus to do this is nice too because you don’t have to go into your budget and disrupt any planned expenses.

Treat Yourself, Wisely

Of course, there’s always the option to treat yourself (wisely) with your end-of-year bonus. If you don’t have any immediate financial needs, you may want to use some of the money to go to a nice dinner or get away with your partner for an overnight stay somewhere.

You can even consider treating yourself to a spa afternoon or some new shoes that you’ve been thinking about for weeks.

While it’s probably not the best idea to completely blow your bonus on material things and impulse buys, there’s nothing wrong with treating yourself to something nice every now and then.

You can simply go to a nice dinner with some of the money then put the rest toward debt and savings if you want to. It’s totally up to you and your needs at the time.


Getting an end-of-year or holiday work bonus can be super exciting. You work hard for your money so you deserve to enjoy it but should also want to use it wisely to help you get ahead.

Consider each of these smart money moves you can make to spend the money wisely. Feel free to split up your spending based on your goals and needs. You can still pay down debt and save while treating yourself to something small and special.

What are your favorite smart money moves to make with a work bonus?