What do you do when you receive your yearly bonus?

The first quarter of the year is the time where a number of organisations give out bonuses and monetary rewards to deserving employees who have contributed to the organisations’ successes.

Some of these rewards are financial, others are in the form of incentive trips, recognition awards and so on.

Spend or save, the perennial question

Life can be simple. It is about choices, yes, no or maybe. The issue with many of us (including myself!) is that we create too many variations which confuse us and make the choices less clear than they should be.

You have received your bonus. The windfall for your hardwork in 2007 has paid off! Congratulations on a job well done for 2007. The money has been credited into your bank account earning you 0.25%. So what are you going to do with this new found wealth?

Many of you will choose to SPEND it. Why not? You’ve earned it! You deserve it! Go pamper yourself! “Life is short, play hard” goes the Reebok tagline. “Live and make merry for tomorrow is another day!” goes another refrain.

Life is indeed short. Short in that all of us have the same 24 hours a day, 7 days a week, 52 weeks a year. How we choose to spend or save will determine how fast or how slow you build up your investment capital that generates you passive income.

Panzer’s approach

My approach has been to earmark 10% of my bonus and windfall gains to living life, and 90% towards saving and investing so as to grow my investible savings so that I move towards the path of financial freedom LONG BEFORE the statutory retirement age of 62 or 67 as the case may be.

I don’t live such an ascetic life that is frugal beyond words. It is simple compared to the average Singaporean but comfortable enough for me to be happy. I have realised that instead of focussing on conspicuous consumption that satisfies only a little while, I should instead be focussing on savings and investing that reaps longer period of recurrent satisfaction through interest, dividends and yields from investments.

Delaying present gratification allows you to grow your means, especially through pass<p style=”margin: 9px 0pt 3px; color: #555555; font-family: Georgia,Helvetica,Arial,Sans-Serif; line-height: 140%; font-size: 13px;” mce_style=”margin: 9px 0pt 3px; color: #555555; font-family: Georgia,Helvetica,Arial,Sans-Serif; line-height: 140%; font-size: 13px;”><span>Posted:</span> 22 Mar 2008 02:19 AM CDT</p> <div style=”margin: 0pt; font-family: Georgia,Helvetica,Arial,Sans-Serif; line-height: 140%; font-size: 13px; color: #000000;” mce_style=”margin: 0pt; font-family: Georgia,Helvetica,Arial,Sans-Serif; line-height: 140%; font-size: 13px; color: #000000;”> <p><img src=”http://farm3.static.flickr.com/2198/2350920349_ce2b430d0b.jpg?v=0″ mce_src=”http://farm3.static.flickr.com/2198/2350920349_ce2b430d0b.jpg?v=0″ alt=”" /></p> <h3>What do you do when you receive your yearly bonus?</h3> <p>The first quarter of the year is the time where a number of organisations give out bonuses and monetary rewards to deserving employees who have contributed to the organisations’ successes.</p> <p>Some of these rewards are financial, others are in the form of incentive trips, recognition awards and so on.</p> <h3>Spend or save, the perennial question</h3> <p>Life can be simple. It is about choices, yes, no or maybe. The issue with many of us (including myself!) is that we create too many variations which confuse us and make the choices less clear than they should be.</p> <p>You have received your bonus. The windfall for your hardwork in 2007 has paid off! Congratulations on a job well done for 2007. The money has been credited into your <a href=”http://singapore-fixed-deposits.com/” mce_href=”http://singapore-fixed-deposits.com/” target=”_blank”>bank account</a> earning you 0.25%. So what are you going to do with this new found wealth?</p> <p>Many of you will choose to SPEND it. Why not? You’ve earned it! You deserve it! Go pamper yourself! “Life is short, play hard” goes the Reebok tagline. “Live and make merry for tomorrow is another day!” goes another refrain.</p> <p>Life is indeed short. Short in that all of us have the same 24 hours a day, 7 days a week, 52 weeks a year. How we choose to spend or <a href=”http://singapore-fixed-deposits.com/” mce_href=”http://singapore-fixed-deposits.com/” target=”_blank”>save</a> will determine how fast or how slow you build up your investment capital that generates you passive income.</p> <h3>Panzer’s approach</h3> <p>My approach has been to earmark 10% of my bonus and windfall gains to <a href=”http://seenthisscenethat.blogspot.com/” mce_href=”http://seenthisscenethat.blogspot.com/” target=”_blank”>living life</a>, and 90% towards saving and investing so as to grow my investible <a href=”http://singapore-fixed-deposits.com/” mce_href=”http://singapore-fixed-deposits.com/” target=”_blank”>savings</a> so that I move towards the path of financial freedom LONG BEFORE the <a href=”http://www.cpf.gov.sg/” mce_href=”http://www.cpf.gov.sg/” target=”_blank”>statutory retirement age of 62</a> or 67 as the case may be.</p> <p>I don’t live such an ascetic life that is frugal beyond words. It is simple compared to the average Singaporean but comfortable enough for me to be happy. I have realised that instead of focussing on conspicuous consumption that satisfies only a little while, I should instead be focussing on savings and investing that reaps longer period of recurrent satisfaction through interest, dividends and yields from investments.</p> <p>Delaying present gratification allows you to grow your means, especially through passive income and to also be more in control of needs vs wants in your life. Needs are few but wants are many. Who doesn’t want to live in a lap of luxury? Who doesn’t want to have a life of leisure or at least to choose what to do with their time. Who doesn’t want to be financially free?</p> <p>If you TRULY, DESIRE financial freedom, you must take the steps necessary and conducive in achieving it. Savings and investing prudently helps you move closer towards financial freedom. Spending and living it up doesn’t.</p> <p>It is not a RIGHT or WRONG approach to life, it is to examine what matters more to you in determining how you decide and live life each day, hour, minute and second.</p> <p>If financial freedom matters, how will you decide to allocate your spending-saving ratio to the bonus or windfall gain?</p> <p>If financial freedom doesn’t matter, it is all up to you to spend or save.</p> <p>I make no judgements as each of us above the age of 21 has our own life to live.</p> <p>Wishing all my readers a Happy Easter, be well and prosper.</p></div>