Why an increase in salary is a good time to plug the gaps in your finances

Prepay loans and hike SIP amounts before you think of discretionary expenditures

The government decided to give its employees a Diwali bonanza by hiking their dearness allowance from 12 per cent to 17 per cent. Around 5 million government employees and 6.5 million pensioners are expected to benefit from this move. The hike will be effective from July. While the government perhaps expects you to spend the money, provide a boost to consumption and get the economy going, an increase in salary is a good time to plug the gaps in your finances.

Experts are of the view that government employees should be cautious with both the lump sum amount (the arrears