As individuals, especially workers we sometimes get windfall incomes
in forms of bonuses, profit shares, etc. However, a lot of the time the
temptation is to spend the money on acquiring a new car, new clothes,
shoes, new phones, among other things. While acquiring these things in
themselves is not a bad idea, it is wiser to use windfall incomes for
things that will have long term positive impart on our lives especially
because we do not have a full grabs of what tomorrow will bring.
For
workers just starting off or in mid level careers, it is really
important not to squander windfall incomes on non-essentials.
Many
years ago during the mid 2000s, when the banking and telecommunication
really became big industries, many banks and telecommunication companies
paid bonuses and profit shares to their staff on a yearly basis. Most
new staff and mid level staff squandered their money on buying cars,
renting new apartments in high brow areas and changing their wardrobes
almost every 3 months. Nite clubs were packed every Friday night with
each person almost trying to out do the other in terms money spent.
Today,
the story is different. The global economy is almost comatose. Banks
are no longer giving huge bonuses, neither are telecommunication
companies doing any better. The oil industry is in shambles. Every
industry is operating lean.
Windfall incomes will not come all the
time as the economic realities have now shown us. So if you are
fortunate to get a bonus or profit share that amounts to something
reasonable, here are a few tips on how to spend wisely:
1) Invest
in real estate: As much as this sounds like really over flogged, it is a
wise counsel. A businessman once said, "the only Estate that is Real is
Real Estate". Real estate is big business. There is a huge demand for
rental apartments especially mini flats and 2 bedroom flats. There are
several real estate companies offering instalments payment options for
those interested in buying land. You can invest your windfall income in
buying a half plot or full plot of land. I will advice you buy from a
real estate company rather than directly from the community especially
if you do not have funds for immediate development.
The simple
reason is that the real estate company usually would have sorted out
community settlement issues with the land owners and so you can be rest
assured that you land is at least secure from land grabbers. Also, by
buying from a real estate company, you will benefit from quick capital
appreciation of your investment and rapid development of the locations
since there will be several people also buying and developing their
property in that location. Another advantage of investing in real estate
is that after developing the property, you can put it up for rent if
you do not wish to reside in that location and use the rental income to
pay for your rent in your desired location.
2) Invest in a
part-time business: If you already have a business that you can run
part- time alongside your full-time job, you should invest your windfall
income in that business. You can buy the needed equipments or register
for a training programme that will increase your expertise in that
business area. If you do not already have business idea, you may want to
consider doing some research to see what part-time business to invest
in.
3) Invest in education: You can invest your windfall income in
further education that will boost your profile and give you a better
chance at a higher paying role in your industry or another industry
entirely. You an also invest in the education of your loved ones like
your spouse, children or siblings (if you have this responsibility
thrust on you)