Is 13th salary better to pay debts or to invest? – 11/20/2021

On the 30th, millions of Brazilians receive the first installment of the long-awaited 13th salary. On December 20, the second installment is paid. In total, the 13th should inject around R$ 232.6 billion into the economy, benefiting approximately 83 million Brazilians, according to a study carried out by Dieese (Inter-Union Department of Statistics and Socioeconomic Studies).

In a country with more than 13.7 million unemployed people and 74.6% of indebted families, these resources will end up favoring the entire economy, also providing respite for Brazilians who do not have access to this right. But the truth is that these billions of reais are starting to circulate even from the pockets of formal workers, with a formal contract, retirees and pensioners.

So, for those people who will receive their 13th salary, which is more worthwhile: paying debts or investing? See what financial advisers heard by the UOL.

As it is extra income, the ideal would be for this money to be used so that the person can invest and carry out plans. But we know that many people, perhaps most Brazilians, have already scheduled the 13th to cover overdue bills.
Jhon Wine, Vice President of Abefin ​​(Brazilian Association of Financial Educators)

How to use the 13th salary depending on the situation

Experts say that it is not enough to compare loan rates with application income for a person to decide what to do. More important is each one to consider their own situation. See which one you fit into.

Are you too indebted or over-indebted: There are debts that together exceed the value of the 13th. In that case, the extra income can help make the payment in a renegotiation, but this cannot be done right away.

The recommendation is to separate this money, outside the current account, to schedule a better time to trade.

In this case, the 13th must go to a risk-free investment with full liquidity, that is, it can be withdrawn at any time without penalties. These are the cases of savings, Selic Treasury, CDB or LCI with daily liquidity and DI funds.

The first thing is to invest in something with liquidity and take the 13th off the account. This money is kept separate while the person negotiates better conditions to pay off what he owes.
Myrian Lund, financial planner at Planejar

Here are 10 steps to renegotiate debt.

It has debt, but it’s up to date: If the person has debt but is paying the installments on time, without any hassles, it is best to use the 13th salary to start an emergency reserve. Even if the discount is interesting in an advance loan, it will be of little use to reduce or settle the outstanding if, later, the person faces an adversity and has to resort to a new loan – with interest rates that will be higher, as the Selic is higher that months ago.

So, it’s best to have an emergency reserve.

Nothing will give a return greater than what a person will spend if he or she needs to borrow to cover unforeseen events.
Valter Police, financial planner and partner at Fiduc

Here’s how to get started building your emergency reserve.

No debts, but budget is at its limit: For those who don’t have debt but are on a budget, that is, the income is only covering normal expenses, the recommendation of financial planners is to bet on the emergency reserve to escape at all costs the risk of falling into new debt in 2022.

Specialists point out that the beginning of the year is marked by extra expenses, such as IPTU and IPVA, school registration, new material and uniform.

Who already has reservations: For those who already have the mattress of financial protection, the 13th salary can then be used to anticipate payment of debts, or to support consumption goals. They can be short term, such as taking advantage of the holiday season to celebrate, giving or traveling, or long term, to change cars or buy your dream property.

Here, the first step is to define the objective, highlight the experts.

Only after defining the objective will the person know how long the money can be invested. And from that point on, the application is chosen.
Jhon Wine

According to financial advisors, the best application will depend on each person’s risk profile and objectives. But broadly speaking, they point to this division.

  • Short term goals, up to 1 year: risk-free and liquid investments, such as those used for the emergency reserve.
  • Goals from 1 to 5 years: fixed income investments with a longer term, such as CDBs, LCIs and Treasury bonds with more than one year.
  • Goals over 5 years: Those above, more shares, equity funds, multimarket funds and real estate funds.

Debt rates x investment income

Financial advisory professionals point out that lending rates are generally higher than the yield on fixed-income investments.

For comparison, while the basic interest rate, Selic, which serves as a reference for fixed income investments, is at 7.75% per year, the cheapest loan cost in the market for individuals, in payroll-deductible loans for public servants , is on average 17.6% per year.

So, paying off debt tends to be more advantageous than putting the money. As long as you already have the emergency reserve.

But these same experts say that in order to have financial discipline and encouragement to invest, it is necessary to seek inspiration in awards that help make life less hard.

Value is not just in financial gain. It is important to sleep peacefully, without debt, have an emergency reserve to protect the family from unforeseen events, have investments to guarantee the future, but it is also necessary to live in the present. A Christmas memento, a celebration, no matter how simple and budget-friendly, are important.
Valter Police

About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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