Christmas is the most wonderful time of the year. With colorful decors, lots of items on sale, and celebrations everywhere, how to spend your 13th month pay can be the toughest question to answer.
The desire and excitement to make yourself and your loved ones happy can turn your holiday budget planning stressful and painful. Of course, you want to reward yourself with the latest gadget for working so hard all year. Moreover, you also want to have a sumptuous holiday feast and give awesome gifts to your family.
So you’re probably wondering: how to spend your 13th month pay wisely? Here’s a list of what you can do with your law-mandated cash gift.
Table of Contents
- How to Spend 13th Month Pay Wisely
- Final Thoughts
How to Spend 13th Month Pay Wisely
These are just some of the guilt-free things you can do with your 13th month pay. If you manage it properly, you can tick off several items on this list!
Pay Off Your Debt
Peace of mind is probably one of the best gifts you can give yourself this holiday season. By paying off your debts, you’re giving yourself the chance to have a debt-free future.
Having the peace of mind that you no longer owe anyone money is simply priceless, and this will allow you to truly enjoy the holiday season and celebrate with your family.
You don’t need to spend all your 13th month pay to settle all your debts, though. Start by knowing how much you really owe and pay off the loans with the biggest charges and fees first.
Loans with the highest interest rates are the most expensive. You can pay off a portion of the principal amount to reduce the monthly interest. If you can afford to, you can even pay it in full and be debt-free in 2022.
Consider Lucrative Financial Investments
If you have little to no debt and don’t know what to do with your 13th month pay, consider investing it. Investments like stocks and mutual funds are great sources of passive income, too, provided that you fund them on a regular basis. With this, you’ll have lots of options on how to spend your Christmas bonus wisely.
- Mutual funds and UITFs – You can start slow by opening both or one of these investments, especially if you’re new to the game. You can start for as low as PHP 1,000 and expect minimal risks.
- Stock investments – If you want something more challenging, you can also try your luck on stocks. It’s a high-risk, high-reward type of investment, so make sure you know how the stock market works.
- Pag-IBIG/SSS investments – You can also choose to invest your money in government-regulated funds to ensure your money’s growth. You can start for as low as PHP 500.
- Real estate investments – How about investing in your future home? One of the best 13th month pay investments out there is real estate. Sure, your bonus won’t cover all the expenses. But it should be enough to pay the down payment for a vacant lot or a rent-to-own condominium. Even if you’re not planning to live in it, you can lease it to tenants or business owners and earn money from rental payments.
Fund a Business
You can also use your 13th month pay to fund your own small business. You’ve probably played with the idea before, but you lacked the capital. Now’s the right time to do so. There are a lot of business ideas out there that require low capital—all you have to do is strategize. Here are some great examples.
- Piso Wi-Fi vending machine – Instead of starting a computer shop, invest on a piso Wi-Fi vending machine. It’s more cost-effective and more manageable. You need to invest on a good broadband plan and a powerful Wi-Fi router to get you started.
- Cake and pastry business – It’s a cliché business at this point, but there’s a reason why it’s in-demand. For starters, it only takes PHP 3,000 to PHP 5,000 to start, provided you already have the necessary equipment. Also, who doesn’t love pastries?
- Bills payment business – You know what else Filipinos need? More payment centers for their bills. Grab this opportunity to start your own by investing on a point-of-sale device. You can start for as low as PHP 5,000.
Get an Insurance Policy
Insurance is one of the most important investments that you can make. It’s often overlooked by most Filipinos since it’s not an immediate need. But the universe is random and unfair—you never know when tragedy will strike. Thanks to your 13th month pay, you can now afford the following types of insurance in the Philippines.
- Life insurance – You can either insure yourself or your loved ones to prevent death from sending the surviving family members into a state of bankruptcy. It may be a morbid thing to purchase, but it’s a necessary investment to have.
- Car insurance – Your car also needs insurance so you can shoulder the expenses in the event of a car accident. Even if you’re confident with your driving skills, some drivers unfortunately are less skilled.
- Home insurance – This provides financial protection against loss and damage to a residential property, either by human error or natural disasters.
- Health insurance – Although the Universal Healthcare Law ensures free health services for all Filipinos, you can still opt for added insurance coverage from private insurers. Prepaid health cards are popular now especially since these are made available at affordable prices to give healthcare access to anyone.
Start a Savings and Emergency Fund
What if you don’t want to spend your 13th month pay on anything? That’s fine, you can just start building your savings and your emergency fund. There’s really no excuse to not have both in your bank account. If you think about it, this is one of the best examples on how to spend 13th month pay wisely.
- Retirement Fund 101: Plan, Save and Invest for Early Retirement
- To Invest or To Save: What Should I Do with My Money?
Improve Your Home
Home improvement is perhaps one of the most popular way on how to spend 13th month wisely.
In fact, your 13th month pay can cover simple and affordable home upgrades that can dramatically change the look of your home.
Here are some things you can do to spruce up your space:
- Dress your windows with new curtains.
- Revive your pantry and buy new storage jars for your stocks.
- Refreshing and repainting your room.
- Create a photo wall gallery.
- Replace old wires and sockets.
- Get more plants and other decorations.
- Reorganize with DIY racks and storage cabinets.
- Upgrade your family room with new carpets.
- Install a bidet in your bathroom.
Spend on Travel and Leisure
What to do with your 13th month pay? Spending on travel and leisure may not have a tangible financial return. But spending on your dream travel should still count as a worthwhile investment.
Out of all the 13th month pay investments on this list, traveling will probably make you fulfilled the most. Explore the world, experience new things, and create new memories that will last a lifetime.
To make things even better, why not include your family in your travel plans? Head down to various destinations this holiday season (and observe health and safety protocols, of course) and spend Christmas with the people you love the most. Not only are you sharing your blessings with your family, but you’ll also strengthen your relationship with them. Isn’t that as good as investing for the future?
Focus on Family Matters
We work hard for our loved ones, and our family always comes first. So if you’re wondering how to spend 13th month pay wisely, then think about the chance to make your family feel special. Instead of spoiling yourself, why not spoil your parents by giving them things they want or need?
If they need urgent medical care, spare no expense in paying for their routine check-ups and medicines. Do your younger siblings want to go shopping? Now’s the perfect time to be the Santa Claus of the family. Again, that’s as good as investing in the future.
Enroll in Online Courses
Online learning and distance learning have become very popular in this pandemic. You can take this opportunity to enroll in a course and advance your education.
Although there are free online courses you can take up, you may also want to pay for courses that will hone your skills and help you discover your hidden potential. Moreover, these paid online courses always come with a certificate that serves as proof of your course completion.
Learn a New Skill or Get a New Hobby
Along with advancing your education, you can also improve your skills or acquire new know-how. Doing so can help you achieve your career goals or secure your chances to further your career.
Why not sign up for a graphic design course? How about a soap-making class or a candle-making workshop? A new skill or hobby means an opportunity to expand your professional network and find new potential sources of income.
You’ve worked so hard the entire year, even if it meant facing the threat of COVID-19. If you still don’t know how to spend 13th month pay wisely, then use it to reward yourself with some pampering and relaxation.
You don’t really need to pay in cash because you can take advantage of credit card promos offering huge discounts and perks. For instance, you can book a staycation with your Citi credit card and get 15% off your bill. Use your 13th month pay to settle your credit card bill after availing of the promo.
Christmas is the season of giving, and the best way to celebrate the season is to share your blessings! Sharing can be done in small ways. One small thoughtful act can mean a lot to someone.
You don’t need to organize a huge charity event for this purpose. Why not prepare a few packs of holiday goodies for the less fortunate people on the streets? You can even hold a fun raffle game online and give the winners special prizes, like prepaid load or grocery items.
Finally, you can also reach out to your former teachers, mentors, or colleagues who will appreciate a piece of holiday ham to grace their Noche Buena.
Knowing how to spend your 13th month pay wisely will help you give a more special meaning to the holiday season. The hope is that you’ll focus on the more important things rather than satisfying your shopping urges.
Your 13th month pay doesn’t come frequently, and not everyone receives it, too. Now that you know how to spend your 13th month wisely, make it count. After all, you can easily just save money next year to check out the items in your cart. Make sure to use this extra money on more useful and worthwhile things.
-  DOLE releases guidelines on payment of 13th-month pay for 2021 (Philippine News Agency, 2021)
-  Why It’s Best to Pay Your Highest Interest Rate Credit Cards First (The Balance, 2021)
-  Property insurance: Protection at all costs (Inquirer.net, 2019)
-  Universal Health Care Act assures cover for all (PhilHealth, 2019)
-  Credit Card Promotions (Citibank, 2021)
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