Most of the salaried people gets salary increment in the month of April and May. If you also have received your increment then you should know how to make the most of this opportunity. Your salary increment is your performance bonus. It is result of your year-long performance and project deliveries and the deadlines you have met therefore it is very important to manage it wisely. We bring you smart tips to use your hard earned money wisely-
Create a contingency fund. This will come in handy during the financial crisis such as treatment of disease, prolonged illness, loss of a job, etc. This emergency fund should have an amount equal to nine months of household expenses.
Use your Salary hike to repay credit cards and personal loans. You can even talk to your lender to request higher EMI (equated monthly installment) so that you can pay it faster. Repaying these loans can save a good amount of interest on such loans.
Contribute some amount of your hike amount towards your existing long-term goals such as retirement or child's education and marriage. It will help you to achieve your financial goals faster. Also, it will allow you more time to build a bigger corpus.
With the changing times, it better to keep learning and developing new skills therefore you can use this amount to join some gym, to learn a new skill or for some recreational activity.