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The 13th salary, also known as Christmas Gratification, ensures that every employee with a signed contract receives extra money.
As the year draws to a close, expenses and financial matters become a priority in preparation for upcoming obligations like IPVA, IPTU, and Income Tax, in addition to any outstanding debts from throughout the year.
It is crucial to plan and invest wisely in your 13th salary rather than just spending it on holiday expenses and Christmas gifts.
To ensure a more even distribution of the 13th salary, it’s important to create a financial plan that includes forecasting expenses to avoid ending the year in debt, as well as setting aside funds for potential investments.
Learn how to make the most of your year-end bonus and invest it securely by reading further.
What is the concept of the 13th salary?
The 13th salary was introduced in Brazil during João Goulart’s government in 1962 through Law 4.090/62, and it is provided to employees under the CLT framework with a signed contract, including those who experienced reduced working hours during the pandemic.
The benefit is paid in two parts: the first by November 30 and the second by December 20, with a maximum of two payments typically allowed.
Given the current uncertain economic situation, it is crucial to be more careful in determining the optimal way to utilize this resource.
Discover the optimal approach for organizing your finances during this time of year and determine the most beneficial way to allocate your year-end bonus. See more details ahead.
4 suggestions for maximizing your year-end bonus
Brazilians should be cautious about spending impulsively after receiving their benefits to ensure they start 2022 debt-free, prioritizing financial planning and investment. Therefore, it is essential to be mindful when receiving the extra salary.
Given the unique circumstances of the past two years and the uncertain times ahead, it is crucial to reassess your current financial situation and outstanding debts. Consider the following factors for this evaluation:
Establish your financial objectives.
If you lack direction and goals, you will struggle to make progress towards achieving financial objectives.
Establishing specific financial objectives is crucial for individuals undergoing a financial assessment to make investments. These objectives will guide your decisions regarding the direction to take in your financial journey.
Understanding your investor profile is essential for individuals looking to invest and set specific objectives. It helps determine your risk tolerance and desired levels of security, liquidity, and return on investment.
2. Settle the debts
Many Brazilian families face financial distress due to unpaid debts like credit card and overdraft balances, leading to escalating interest rates and a cycle of debt accumulation.
74.6% of Brazilian households ended October 2021 in debt, as reported by the National Confederation of Commerce of Goods, Services and Tourism (CNC). It is advisable to clear debts before making any investments due to the typically high interest rates on debts.
Take advantage of the 13th salary to improve your financial situation by settling debts, including overdue credit card payments. A helpful strategy is to pay more than the minimum amount each month to clear the debts faster.
If you have credit card debt, consider contacting your card issuer to negotiate. Requesting lower interest rates is a common practice, especially if you have a history of timely payments. You may be able to secure a reduced interest rate or possibly have the interest waived if you can pay off the entire debt.
To secure a sound financial future in 2022, it is crucial to prioritize using the 13th salary to pay off debts when investing and managing your money effectively.
Set aside funds for unexpected situations.
It is essential to set clear financial goals when paying off debts and pinpoint problem areas to develop money-saving strategies.
You can allocate a portion of your 13th for investments or emergencies in addition to using it for purchases and debt payments.
Plan based on your current needs.
4. Establish your financial objective.
It is crucial to assess your financial planning goals in order to effectively utilize your money, especially when deciding how to use your 13th salary to avoid impulsive spending.
Just saving money is not sufficient; it is important to determine the optimal way to utilize the thirteenth.
Having well-defined goals makes it simpler to allocate money to crucial and high-priority matters.
Learn how to invest your holiday bonus in 2022.
Beginner investors often wonder how to invest their year-end bonus effectively. The key is diversification, which offers the opportunity for good returns in both fixed and variable income investments.
The investor needs to consider their investor profile before choosing a financial product and analyzing the economic situation is crucial for building their investment portfolio.
It’s crucial to consider the investment’s objective and the level of risk you are prepared to accept.
Explore a few options that could distinguish themselves as top investment choices for 2022.
Variable earnings
Investors prefer variable income over fixed income because the Selic rate has remained stable at 2% in 2020, resulting in low returns.
You have various choices available. One option is to invest in Stocks and Index Funds (ETFs) to benefit from market performance. Index funds (ETFs) are a preferable option for individuals looking to capitalize on the growth of the reference index during a crisis recovery, with potential for short-term returns.
The market is highly unpredictable because of the uncertainty in the epidemiological situation. Therefore, it’s important to exercise patience, make gradual purchases, and observe how the assets perform.
Real estate crowdfunding offers a convenient and secure method for making profitable investments, making it one of the most favorable business prospects in the near future.
Collective funding is for individuals looking to grow their finances through investments without risking losing a portion of their assets.
Profitability typically ranges from 12% to 18%. This kind of investment is quicker and more adaptable than other assets, as well as being a cost-effective option with straightforward promotion. Find out more here.
You can also invest in Real Estate and Multimarket Funds, but it’s crucial to consider the volatility, fund manager’s approach, market fluctuations, and policies before purchasing shares.
Stable rental cost
The Selic rate and inflation fluctuations can impact the returns on fixed income investments such as Debentures, offering higher-than-average income opportunities.
The CRA (Agribusiness Receiving Certificate) is a type of fixed income investment that may offer higher returns compared to government bonds.
The Selic Treasury is a suitable investment for beginners looking to invest their 13th salary as its returns are linked to the Selic Rate, making it a good choice for those starting to invest or aiming to build savings for emergencies while gaining financial knowledge.
In conclusion
Have you observed how convenient and straightforward it is to make use of the 13th salary while also investing?
There are numerous investment opportunities available for individuals looking to grow their 13th salary and start 2022 with stable finances.
The top investments can differ based on the goals and approach of individual investors.
If you’re looking to invest in your 13th Anniversary to ensure your financial stability but feel uncertain about how to begin, click here to learn more about INCO.
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