Bonus or Inheritance? Here’s How NOT to Blow It with Jess Brady

By Molly Benjamin, Founder of Ladies Finance Club

Listen to the full podcast here.

In this episode of Get Rich, Molly chats with financial adviser and money management expert Jess Brady about a topic that’s exciting but easy to mess up: bonuses (or any surprise lump sum like an inheritance). Whether it’s a work bonus, commission, tax refund or a gift from grandma, how you handle that money can either fast-track your financial goals or disappear before you know it.

Why a Work Bonus Can Make or Break Your Financial Future

Let’s be real, we’ve all mentally spent a bonus before it hits our account. A designer handbag, a weekend getaway, maybe a fancy dinner or two. But Jess reminds us that your bonus isn’t “free money”. It’s a reward for your hard work and deserves a smart financial plan to match.

How to Budget Your Bonus Using a Simple Spending Strategy

Jess shares a practical and flexible budgeting method for handling any lump sum, whether it’s a bonus, commission or inheritance:

• 50 percent: Put towards a key financial goal like debt repayment, emergency savings or a home deposit
  
• 30 percent: Invest in your future self through upskilling or financial education
  
• 20 percent: Spend on something fun that brings lasting joy, not just a quick thrill
  

This approach helps you build wealth while still enjoying your money.

Understanding the Tax Implications of Your Bonus

Bonuses are usually taxed at your marginal rate, which means the amount that lands in your bank account may be less than expected. Jess recommends waiting until the funds arrive before making any spending decisions. It’s also a great idea to direct the bonus into a separate account before allocating it across your budget.

Debt Management Tips When You Receive a Lump Sum

Jess explains the three types of debt and how to prioritise them:

• Good debt: Used to build wealth, like a mortgage or student loan
  
• Bad debt: Loans for depreciating items, such as cars or furniture
  
• Toxic debt: High-interest and addictive, like buy now pay later services or credit cards
  

Jess recommends either the snowball method (paying off the smallest debt first) or focusing on the highest interest rate. Either way, taking action is key and visual tools like debt trackers can help keep you motivated.

Building Positive Financial Habits That Stick

Jess encourages using visual cues to stay focused on your financial goals. One clever trick? Set your phone’s wallpaper to your vision board or a money mantra. We check our phones around 58 times a day, so it’s a powerful way to keep your goals front of mind.

How to Use a Bonus to Boost Your Financial Goals

Rather than blowing the lot, your bonus can be a stepping stone to long-term financial security. With the right blend of saving, investing, debt reduction and fun, you can turn a one-time payment into meaningful progress toward your money goals.

Whether it’s a bonus, inheritance or tax refund, a little planning goes a long way. Jess’s advice proves that personal finance doesn’t have to be restrictive, it’s about making choices that support your future while enjoying your life today.

🎧 Tune in to the full episode now and don’t miss our next chat with Jess, where we tackle your biggest questions about HECS debt.