What should I do with a raise or bonus so it improves my finances instead of vanishing?

Windfalls disappear when they hit your account without a plan. Decide the split before the money arrives. For a raise, immediately increase your 401(k) contribution rate or automated savings so a chunk is captured before lifestyle adjusts, then let yourself enjoy a portion. A useful default sends roughly half of any raise to savings, investing, or debt and keeps the rest for living. For a one-time bonus, weigh it against your priorities: top off the emergency fund, knock down high-interest debt, then invest, before allocating any to fun. Remember bonuses are often withheld at a flat supplemental rate, so the net is smaller than the headline. The habit that builds wealth is treating income increases as opportunities to widen the gap between earning and spending.