Tax Refund?  Spend Wisely!

If you are expecting a tax refund, you planned well and will not owe any penalties or have any surprises.  If it is a large refund, you may have too much withheld.  This is not a bonus.  This is an interest free loan to the government.

Here are some ways to spend that refund check.

1-Emergency Fund-Start or add to your fund in an interest -bearing account .  This should be easily accessible for future emergencies.

2-Pay off High Interest Debt-Contribute to your emergency fund first and then pay off debt.

3-IRA-Start or add to your IRA (traditional or Roth) for the year.  This can grow over the years to a sizeable amount.  Or if you have a traditional IRA, consider converting some or all to a Roth paying the taxes for the conversion with this year’s refund.  This will save you taxes in the future on the initial investment and the earnings.

4-Spend on Necessity-Car repair, dental work, house repair.  Spend on something you have put off for lack of funds but really need!

5- Save for the Future-Start a savings account for specific goal.  This saves from possibly creating debt in the future (I do not like car payments-save in advance!).

6-Splurge-Spend it on something you want!  Vacation, home improvement, start a new business, summer camp for the kids.  You did earn this money!

7-Charity-This gives you a chance to give back or pay it forward.

Tax Refund?  Spend Wisely!
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