5 Smart Ways to Use Your Tax Return this year
Are you expecting a nice tax refund this year? If so, before you go and blow every penny on the temporary good Life. Consider using your money more wisely so, in the long run, you can live a more permanent Good Life. Now, there’s nothing wrong with splurging a little but if you’re drowning in debt it’s not a very wise decision to go and blow your entire tax refund on clothes, shoes, and TVs. Check out these 5 smart ways to use your tax refund this year that will set you up for the entire year and years to come.
Start an Emergency Fund
Having an Emergency fund will prepare you for those unexpected events that are bound to eventually happen in Life. Like for instance, your car needs a major repair, the Hot water heater goes out or the roof starts leaking. When you have an Emergency fund already in place you will be ready for those unexpected life events that will happen vs not having any back- up plan which is going to probably lead you to go into debt. It is recommended that you have at least $1,000 in your emergency fund and have it in a separate easy to access account.
Pay Off Debt
Before going on a shopping spree you should pay off your debt. This is going to make a huge difference in your life. There’s no better feeling than being debt-free. Even if you can’t pay off all of your debt you can still start paying your debt down. Make a list of all of your debts, using the Dave Ramsey recommended debt snowball approach pay off your smallest debt first and work your way down to your largest. Before you know it you will be debt-Free! If you’re expecting a large Tax refund you will be debt-Free even Faster.
Pay Cash for Big Ticket Items
Instead of diving deeper into debt by financing those must have big-ticket items like a car, or the new big flat screen smart TV pay cash.
Whether you are expecting a large refund or a small one. Investing it wisely will make a HUGE difference in the long run. Consider investing in your retirement or your Kids college fund.
Give it away
God Loves a Cheerful Giver
2 Corinthians 9:6 says “He who sows sparingly will also reap sparingly, and he who sows bountifully will also reap bountifully.” There are plenty of legitimate charities, churches, and families that are in need. Use this opportunity to sow into the lives of others and you will be blessed.
If you get a large income tax refund, what would you do with it?