“It is an opportunity to increase savings”

Meals with friends and family, buying gifts or doing leisure activities (cinema, museums, trips…) usually alter the normality of our lives. Personal finances at Christmas. For this reason, many workers wait with great expectation for the entry of the extra Christmas pay, a relief in the middle of the spending storm.

However, this additional income, in addition to relaxing our domestic economy, can become a savings and investment instrument with which to generate income.

“The extra pay is an opportunity to increase the family savings base,” they say from Ibercaja. The Aragonese banking entity assures that to serve as a means of savings “We must plan how it will be used, both for necessary expenses and to finance summer expenses” and remember that “there is no specific amount of monthly savings that is perfect, since it depends on the family and financial situation of each person, but it is established, as a reference, save around 20% of our income“.

The BBVA bank in its blog dedicated to personal finance planning offers some tips to make this income profitable in the best possible way. A good option are paid accounts, a type of deposit that offers you a certain return on your savings and that allows you to always have your balance available. Currently, This product offers returns above 3%as is the case of the Openbank account (3.30%) or that of Cetelem-Raisin (3.33%).

On the other hand, for people who have debts derived from a loan of any type (mortgage, car note…) it is to take advantage of it to amortize the installment or term. “This extraordinary contribution will help lower the total interest payableto reduce the amount of the monthly payment (if you decide to amortize the payment) or to return the loan sooner if you choose to reduce the term,” highlights BBVA.

Another interesting option may be investment. “Although the idea of ​​investing may seem limited to large assets, the truth is that allocating part of the extra income to investment pcan make our savings grow at a faster speed“, states the bank, which specifies that “it is best to do it with small investments and try to inform yourself as much as possible” to, for example, enter the stock market. For those who do not yet trust their own knowledge or experience, a good option is “resort to investment funds managed by specialized entities in managing investment portfolios”.

Finally, BBVA focuses on the future and ensuring a good cushion for retirement. Therefore, the entity recommends contribute that money to a pension plan with which you can annually deduct the amount contributed in the income tax return. Of course, currently, The contribution to individual pension plans is limited to 1,500 euros.

How many payments are there and when are they collected?

Extra payments are salary supplements that a company’s workers normally receive twice a year. This gratification comes included in the Workers’ Statute (Royal Legislative Decree 2/2015, of October 23).

“The worker has the right to two extraordinary bonuses per year, one of them on the occasion of the Christmas holidays and the other in the month that is established by collective agreement or by agreement between the employer and the legal representatives of the workers”, specifies article 31 of the aforementioned rule, which adds that “however, it may be agreed in a collective agreement that extraordinary bonuses are prorated over the twelve monthly payments.”

In this way, one of these payments is collected at Christmas, while the other does not have a fixed date, since it depends on what each collective agreement determines, although The most common thing is that it is paid between June and July.

This bonus was awarded for the first time in December 1944 and originally It was equivalent to a week’s salary. The Franco regime imposed the measure with the objective that workers could have a more dignified Christmas in impoverished post-war Spain.

Subsequently, and given the popularity of the measure, it was decided to create a similar gratification in summer for July 18, the date of the Coup d’état against the Government of the Second Republic. These two payments have been maintained to this day.

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