It’s the most wonderful time of the year! Tax Season is here! Alright, it’s time to fast forward to the fun stuff – your tax refund. How are you going to spend your tax refund this year? Are you planning to save it or are you going on a shopping spree? Before you make a decision, check out some helpful tips below!
You never know what life is going to throw your way. Unexpected events happen all the time. Make sure you have money tucked away to cover yourself should something unfortunate happen such as a medical bill, vehicle repair or job loss. Financial experts recommend having six months’ worth of expenses in your emergency fund. This is not an account that will accumulate overnight. This is a long term goal you can set for yourself, but adding a chunk of your tax return to this account definitely would not hurt!
Pay Off Debt
Credit Card Debt? Car Loan? Mortgage? Many of us have some sort of debt and that is okay! However wouldn’t it feel nice to pay off some of that debt quicker than expected? Use your tax refund to pay off the credit card that has been weighing over your shoulder. Or put extra money towards your student loans. The simple act of using your refund to pay off an extra $1,000 of debt this year could save you hundreds of dollars in future finance charges.
Save for Retirement
It’s never too early to start thinking about your future. If your current finances are in check, stash some money away for retirement. If you already put in enough money per paycheck into your 401(k) for your company to match, consider starting an IRA. An IRA allows you to have more control over your savings than a 401(k). The sooner you save; the better off you’ll be in the future.
Tackle maintenance projects
Maybe you never had the money to replace that old furnace, patch that leaky roof or replace the worn tires on your car. Use your refund to complete maintenance projects that can cost you even more if you wait.
There is nothing wrong with spending your tax refund on a family vacation or that new computer you’ve been dreaming of. As long as your savings are in order – have FUN with your tax reFUNd! See what I did there?
Until Next Time,