Your bonus could be the key to a new life

As December arrives, the holiday season ushers in a spirit of joy and giving. For many employees, it's also the time when they receive a bonus or 13^th salary cheque.

And while the thought of being able to spend more freely or even indulge in a holiday splurge or two is enticing, channeling this financial windfall towards a more substantial and long-term goal like homeownership, can transform this seasonal bonus into a life-changing investment, says Gerhard Kotzé, CEO of the RealNet property group.

"Owning a home is a dream cherished by many as it represents stability, security and a place to call your own. However, navigating the path towards homeownership usually requires diligent financial planning and saving. The arrival of a December bonus cheque presents a unique opportunity to bolster those savings and take significant strides toward turning this dream into a reality.

"The amount may seem relatively small when weighed against the total cost of a home purchase, but a bonus can provide a considerable injection of funds to significantly boost your deposit or your cash reserves to cover transaction costs such as bond registration, legal fees and transfer duty. This acceleration will bring you closer to the financial requirements necessary to secure a home loan and purchase a home."

Alternatively, he says, you could choose to allocate your bonus towards reducing existing debts, such as outstanding personal loans or credit card balances. "By minimising these financial obligations, you will enhance your financial health, which will once again make you a stronger candidate for bond approval and enable better terms on your home loan.

"In addition, putting your bonus towards homeownership illustrates your financial discipline. It demonstrates the willingness to prioritise long-term goals over immediate gratification and fosters a habit of prudent financial decision-making that is invaluable in the homeownership journey."

Using your bonus to advance your homeownership goals rather than just splashing out on holiday fun is very much a commitment to building your own wealth, says Kotzé. "Real estate historically appreciates over time and for most people, homeownership serves as a cornerstone of their financial stability, potentially generating long-term gains while providing them with a valuable asset.

"Homeownership also provides emotional fulfillment. The sense of achievement and pride whether you are buying your first home or your second or third, is huge, as it provides a tangible representation of hard work, dedication and discipline. Over time, a home of your own also offers stability and security for you and your family, providing a sense of permanence and enabling you to create cherished memories as you build a foundation for your future."

In other words, he says, leveraging a December bonus towards homeownership can be a truly transformative decision. "It's an investment not just in property but in your future. So we suggest that if you are fortunate enough to receive a bonus this year, you resist the temptation to splash out and immediately seize the opportunity to start turning your property ownership dreams into reality."