travel & lifestyle blog by ruth dela cruz
Personal Finance

13 Smart Ways to Spend & Enjoy Your 13th Month Pay

November 7, 2022

It’s the most wonderful time of the year, indeed – and one that employed Filipino workers always look forward to. The season to receive and enjoy their 13th Month Pay.

The 13th Month Pay is the payment of an additional monthโ€™s salary during the financial year. It is a monetary benefit to employees as mandated by Philippine Law and should be given before December 24th.

Regardless of the amount of your 13th Month Pay, it is always good to have balance in life. I am sharing practical tips and smart ways to spend your 13th Month Pay.

Side story: I remember writing a similar article for the company newsletter. ๐Ÿ’™ I am happy and excited for friends and colleagues who would be receiving their 13th Month Pay. It’s been 9 years since the last time I received my 13th Month Pay (and 14th Month Pay). One of the benefits I had to let go of when I left my job – that I honestly felt like I had an early retirement; but that is another story to share for the next blog. ๐Ÿ˜Š

13 Ways to Spend and Enjoy Your 13th Month Pay

My rule with money is:

“Save money, but don’t wait to live your life.”

  1. Pay Off Your Debts. Debts can really cause anxiety and it is smart to clear your debts – partially or fully. You can start with high-interest debts, loans, or credit card bills. Paying off debts is one of the steps in building a solid financial foundation. Take the first step to your financial wellness. Read more about the First Five Steps to Building Your Wealth.
  2. Build a retirement fund or beef up your emergency account. The pandemic has taught us that it is good to save on rainy days. One of the simplest things you can do with your bonus money is to save it – be it for your retirement fund or emergency fund. Emergency fund should be equal to at least 6 months worth of your monthly living expenses.
  3. Pay your insurance premium. Paying your insurance premium in advance help with the financial load, while ensuring you are protected in case of accident/illness. If you do not have an insurance policy yet, it is smart to get one. You may choose term insurance which you can pay one-time annually or get insurance with investment (VUL). One of the money mistakes people make when they have extra cash is to skip this step and go straight to investing/growing money.
  4. Invest in your health. We are one critical illness away from poverty, and getting sick is not cheap. Get additional health insurance and save yourself first.
  5. Invest in yourself. The best investment that you can make is to invest in yourself. Take up a course to upgrade your skills, buy books and tools, or sign up for a workout class, this is one investment with no losses.
  6. Invest in stocks and grow your money. But before you start investing in stocks and crypto, make sure that you did not skip numbers 1 to 5. Only invest money that you can afford to lose. All investments take time to grow, so be cautious of investments that promise a big return in a short time.
  7. Upgrade your tools. If you have a side hustle that gives you additional income, it is best to upgrade your tools so you can work efficiently and produce more income. If you are a photographer or digital creator, you can upgrade your camera lens or editing software. The money you invested/spent for the new upgrades would return back in no time.
  8. Buy new items you always use (and overuse). Underwear, innerwear, socks, makeup, etc. I personally invest in good bras and underwear that can last me for years. Don’t wait for them to go ratty before you buy new sets. If you work in an office set-up, invest in good, classic pieces. These new items can help you feel good about yourself, too.
  9. Spend on home improvements/car maintenance. Check your home for areas that may need repair like roofing, bathroom fixtures, kitchen sinks, etc. Don’t wait for the damage to get worse, or when it is rainy season and labor/material costs are higher.
  10. Start a small business. Have you always wanted to start a small business like an online store? You can use your 13th Month Pay to fund a passion project and grow your money.
  11. Share your blessings. Share with your family, friends, or charity. You may use it to book a hotel and celebrate with your family while making a memorable experience. You may also donate some of it to your chosen charity.
  12. Pay yourself and experience new things. I am all for fun and having balance in everything that we do. Buy something special for yourself or to book that trip that you have been wanting to go on. If you already have good cash flow and savings, you deserve to treat yourself and enjoy the present.
  13. Build a Fun Fund. If you are all good with your finances, you can start a Fun Fund. I just started a Fun Fund Savings account which I intend to use for all things fun – like dinner with friends, or for buying BTS merch I like. ๐Ÿ’œ

I hope you find this list helpful. โค๏ธ

Leave a comment if you have other suggestions on how you spend and enjoy your 13th Month Pay.

Related Read

10 Ways I Save Money During Travels

The First 5 Steps to Really Start Building Wealth

  1. Thanks for this rules of yours yours Ms.Ruth about spending money ,it really helps to me knowing na ung iba hnd kopa n gagawa ๐Ÿ˜Š

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