Privilege Blog

How To Spend Your Annual Bonus, Or, Saturday Morning at 8:34am

The annual bonus. At some point, either you or your partner may find yourselves so rewarded at the end of the year. I still remember my first time. I was at Sun Microsystems, in 1998. Those were the days when dollars dropped from the sky, as the company furnished the server underpinnings of the Internet. After years of frugality enforced by my desire to stay home with my children, I was suddenly and impulsively free to buy something I’d always wanted.

Hence my trusty black and white Chanel jacket.

Was it a wise choice? Surely there were debts to pay. Surely that money invested might have compounded. But I think yes.

  1. Most of the bonus went to other family expenses.
  2. The debt to my childhood affection for luxury was pretty steep back then.
  3. The jacket has made me happy in the wearing.

This year I find myself again with a bonus, for which I am extremely grateful. I do not take these things for granted. I don’t know how, but my parents managed to bring their children up believing that we owe the world a good job, and that no rewards are ours by right.

So how to spend the bonus this year, 15 years older and wiser?

The decision still comes down to debts and generosity, and the interplay of these constructs. We ask, where does duty stop and the gift begin? Are they always in opposition? We ask, is all self-control and future-thinking good? All release and splurging on the moment evil? Few large questions are answered with the word, “All.”

I entertain the idea, as best I can, that some people find great joy in self-restraint for its own sake. Whether it’s an artifact of heritage, or hard-wiring around small motor precision, I don’t know, but I myself require some Dionysus.  Imagine the Geico pig in the backseat, shouting, “Whee!” Yeah. That.

So this year first I paid down a chunk of my home equity loan. Wait! Does Dionysus care about mortgages? The ability to remove anxiety about future living and financial security eventually becomes a source of joy rather than an obligation. I’m generously paying for future Lisa’s peace of mind.

A future, older Lisa, that I see more clearly every day.

But of course today’s Lisa wanted something too. A pair of turquoise earrings, from Barneys. The luxury wasn’t the item itself, rather it was allowing myself not to bother with a return when I realized they were small for the price. Spared myself a dutiful value for money calculation.

Then I emailed my kids. “Hey,” I said, “I’m good for a present. Something less than $500. Act now, this will end once I re-retire.” They got right on it. The boy child wanted this coat. I added a sky blue scarf. Dapper, no?

The girl child needs a new bag. I particularly liked this “Rider” bag, from Loeffler Randall. All the ladylike sass of Kate Spade sans show-off logo display. She’s considering.

Was it duty, on my part, giving presents to my children? No, although the parent-child relationship is arguably the most dutiful of all. Whenever I have enough it’s more fun to give, to my children or to other loved ones for that matter, than to myself.

Finally, I said to Significant Other, “Honey, I want to buy you a present.” He considered. His choice? That I pay down more of my HELOC. Now that’s love.

Generous duty is so much better than dutiful generosity. Debts repaid from the heart serve as gifts, even to oneself.

Have a wonderful weekend.

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35 Responses

  1. Oh I love the divide. You took care of business, yourself and your loved ones. I say perfect!

    Those earrrings will look beautiful with you eyes. Love all the giving.

  2. Well done Lisa. I’m especially fond of giving gifts to the children. As for paying down the HELOC, I’m in no hurry because the interest is so cheap at the moment.

    Those earrings will nicely compliment your blue eyes.

  3. I love this! the generosity, the really cute earrings, the paying off of the loan. And I really appreciate your comments on how you were raised to do a good job. Where do so many people today get the entitlement they so freely exhibit? (I’m feeling pretty cranky for a girl in her early forties! haha!)

  4. My philosophy on bonuses:

    1. Do something splurgy for yourself with 5% of it (and if that means buying a treat for someone else, that is fine)
    2. Put a chunk of money – 50% – toward something big, like the mortgage, the furnace, or a new driveway
    3. Put the rest in the bank because you never know.

  5. You had earned the bonus, so I think that what you wished to do with it, was totally your own business.
    Since the only money I have received ” as a surprise ” are some taxes returned, the sum being very modest, I splurged it on myself, buying something I would have bought later on.
    Now, if the sum had been significant, I guess it would have been all spent on regular bills ( there is no end in them ).
    Since you are well off, it was a nice gesture to divide the bonus between your family : ).

  6. I see you wearing a white shirt and those earrings, they are beautiful!

    The small size has one advantage: they wont make the ear-holes “sag”.

  7. Generous duty is a lovely way of seeing this. And it’s fun, it opens the heart. You are lucky that your loved ones can receive so gracefully.

    My own bonus payment this year fell prey to a case of tax progression, less than 50% were actually paid out. But I also split the sum: got myself a lovely silver and amber brooch from the 30s as a palpable reward and put the rest towards savings, also approved by SO. As a colleague who does likewise put it: a lot of method – and a little madness.

  8. What a great post Lisa. Very thoughtful and I agree with all that you did. I especially love what your significant other wanted for his gift.

    Tho older me and my older husband (60 and 61 now) loom before me almost every day now. My husband’s significant end of the year profits went into retirement savings—every last dollar of them. While we already have plenty set aside, there is always the unknown–and the needs of others (children and their children–some with special circumstances.)

    By the way, I think being debt free is the best thing you could accomplish by the time you are 60 when it comes to finances.

  9. My current job happens to pay out small performance bonuses monthly … on gift cards. Which leaves no way to put that towards debt, etc, but it does leave the possibility to either splurge (for example, a couple times I year I get them to clothing stores and buy work clothes, which feels like splurging) or spend wisely (groceries, saving for big household items).

    As far as parental gifts go I’m strangely uncomfortable being on the receiving end. Maybe I know too much about the state of my mother’s bank account and have heard too much over the years about what she can’t afford, but I just can’t bring myself to take her up on it when I’ve received similar offers. Not to say I don’t appreciate the occasional gifts when they happen, and birthday and Christmas and the like, but the idea of “hey let me buy you something” I somehow don’t feel comfortable accepting.

  10. A lovely win-win-win-win all around! Splurgy and serious, everyone is happy. Beautiful selections for your children’s gifts, makes for a very happy Saturday morning! (I loathe the Geico pig.)

  11. Loved, absolutely loved this post I think your earrings are beautiful and so is the handbag. Exquisite.
    Congrats on your having a great SO… Now, that’s love for sure!!!
    Enjoy all of it, and congrats, too, on your well-deserved-I-am-sure bonus!!


  12. We do the same as you. My husband’s job is highly bonus oriented. Our children are small, so we don’t buy them things, but we buy ourselves a couple of nice things, and the rest goes onto the mortgage. We aim to be debt free in a couple of years. We live to his salary though – a bonus is just that, and there is no certainty over another big one coming through, hence putting most of it on the mortgage. Sadly, too many of his colleagues gear themselves up with massive amounts of debt, and when they don’t perform well and don’t get the big bonus, or worse, lose their job, have serious difficulties.

  13. Oh a bonus must be such fun…just thinking about it must give you joy.
    Rather like a win and to be able to do something sensible as well as giving gifts to yourself and your children…
    If I were to receive a windfall or a bonus I would buy a Chanel handbag.

  14. Hmmm last year we saved the biggest part of the bonus, but splurged in a DSLR camera, after analysing, comparing products, and wanting one for a long time.

    On the subject of giving, I have notices it makes me happy. I am a natural gift-giver, and for no good reason. ” A very merry unbirthday” might be my mantra. And as I analyze my spending, I realize I spend lots of money on other people, be it cakes I bake, or small gifts, or stuff I send by old fashioned post to friends. When I do splurge on myself it is mostly books (or baking supplies). My husband someone has to *force* me to get basic items of clothing like new jeans… because you know I wear stuff until it rips apart. I do have a soft spot for dresses. I will never have enough.

  15. Thank you for your post.

    I really started to smile it when I read the part about presents to your children. And another big smile when your wrote that your Significant Other thought it was more important to pay more down on your house. :-)

    Keep up the good work. Who knows perhaps your bonus next year might even be larger than this year?

  16. What a well balanced way to spend your bonus.

    And I love your son’s coat.

    Good taste must ooze through their veins.

    Beautiful blue earrings.

    Well done you.

    xo Jane

    1. I too LOVE that coat! Did you see it’s reversible? Looks like Lisa caused a run on the scarf, it’s now sold out!

  17. Hooray, a bonus! They appreciate you. Bask, in both that achievement and in your wise and loving choices.

  18. Well done! You took care of those that count (and wisely enough that included ‘future Lisa’)!
    Your children have obviously taken after their chic mum, what fab pieces they have picked! I love that coat!!

  19. That’s so lovely of you, my mum has always thought of me too whenever she has an unexpected windfall.
    I’v never known anyone with a ‘big’ job so the world of bonuses is alien to me,it must be very sweet!

  20. You got not only older you got much much wiser and this is a big gift. You can be very proud what you achieved till now. It’s not about what you have, it’s about what you like. Congratulation for your decision which was very wise and well considered.

  21. A great choice of what to do with your annual bonus and congratulations on it too! Its so nice when something unexpected comes our way and I expect your children were so thrilled to get your “I’m good for a present” statement …! S x

  22. All perfect choices. The earrings are beautiful, and I’m glad they are gracing your ears.

  23. Yay for paying down ugly expenses – beat down that principle, woohoo!

    And I am so in agreement on logo-less womenswear/accessories. It is probably why, yes, I do love the eye candy of Kate Spade… but I won’t buy it if I can see where it came from on that annoying metal clasp. Beautiful nude shade of a handbag that would contrast beautifully with so many colors, esp pastels!

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