It’s tax season! Do you have plans on what you are going to do with your refund check this year? While it might be nice to go splurge on a vacation, new wardrobe, etc., it is actually wiser to spend it on necessary items rather than our wants.
We use our tax refund to pay off any debt we have collected over the year and get it paid off in one big chunk. Here are a few suggestions of what you can do with your tax refund check that may be more beneficial to your household.
10 Smarter Ways to Spend your Tax Refund
Pay off Debt.
If you have any debt that you have collected over the year such as credit card, medical bills, car loan, student loans, etc., pay off a chunk of that debt. You will feel so much better when you do and not have to worry about that debt anymore.
If you have been waiting to repair something in your home now would be the time to do it. Try buying the supplies and doing it yourself to save even more.
Start or Add to your Emergency Fund
It’s important to have an emergency fund for an Emergency. Things unexpectedly popped up over time and it is nice to have that emergency fund for when they do. You can learn how to start an emergency fund in 3 steps here. If you already have an emergency fun, you can add more money to it.
Whether you need new tires, oil change, or any other maintenance on your vehicle, you can use some of the refund money for this.
Start a College Fund for the Kids.
It’s never to early or too late to start a college fund for the kids. Put the tax refund into a 529 plan or savings account to help save for their future.
Save for Retirement.
Invest your tax refund into your retirement fund so you can live comfortably after retirement.
Pay More on your Mortgage.
Use the whole refund or part of it to pay down your mortgage. This will help you get your house paid off sooner.
Stock up on Groceries.
While this may seem a bit strange to spend some of your tax refund on, it is actually wise. Stock up on meats by buying half of a cow and storing it in your freezer. Meat can be expensive so this would be a wise time to find a local farmer and save. Stock up on toilet paper, paper towel, cleaning supplies, etc. This is a time where you have extra money in hand to stock up on items you need throughout the year. This will also save you from going to the store more often to purchase these items.
Make an Extra Loan Payment.
If you have a loan taken out make an extra payment on the loan to bring down the costs. This will help you get your loan paid off quicker than planned.
Buy Something you Need.
This means something you need and not want such as if you washing machine is broken that would be something you need. Be sure to think it over and make sure that you really need it and it would benefit the household or yourself.
If you don’t want invest or spend, then just simply save it. There is no need to quickly spend the refund check. Put it in a savings account for later and decide what you want to do with it down the road.