10 Ways to Use Your Tax Refund Wisely
Done filing taxes? Congratulations! There are many ways to maximize the value of your tax refund, and these include:
1. Set Up an Emergency Fund
There is no telling when your car will break down, your home's heating system will stop working or other problems will arise. Fortunately, if you use your tax refund to set up an emergency fund, you will have money available to help you handle major and minor emergencies.
2. Pay Off Outstanding Debt
Don't let outstanding debt get the best of you. Instead, use your tax refund to pay off your credit cards, late bills and other outstanding debt, and you can instantly improve your credit score.
3. Establish a Savings Account
A savings account makes it easy to accumulate extra money over time. Use your tax refund to establish a savings account, and you can watch your savings grow.
4. Complete Home Improvements
If your house's roof is in need of repair or other home improvement projects fill your to-do list, there may be no time like the present to perform these property upgrades. Thanks to your tax refund, you can purchase the supplies you need to improve your residence. Or, you can hire expert contractors to complete home improvements.
5. Make a Charitable Donation
If you want to do something good with your tax refund, you can make a charitable donation. This enables you to provide money to the charity of your choice. Also, the donation may qualify for a tax deduction, which means it could help you get money back on next year's tax return.
6. Start a Small Business
For those who want the freedom to be their own boss, owning and operating a small business is ideal. Thankfully, you can use your tax refund to lay the foundation for a small business. You also can use your tax refund in conjunction with a small business loan to further accelerate the growth and development of your business.
7. Invest in Your Retirement
A Roth IRA enables you to put aside thousands of dollars for your retirement annually. Use your tax refund toward a Roth IRA, and you can have extra money at your disposal when you're ready to retire.
8. Fill in Insurance Gaps
Insurance is a safety blanket that most people ignore, yet it could prove to be a difference-maker for individuals of all ages. You might already have health or homeowners insurance, but you can use your tax refund to add coverage to your existing insurance policies. You can always set up a life insurance policy to guarantee financial protection for your loved ones too.
9. Save for College
A 529 account is a viable option for parents who want to use their tax refunds to help their kids save for college. With a 529 account, contributions are not subject to federal taxes. Therefore, when your child needs money while attending college, he or she can withdraw 529 account funds tax-free.
10. Make Necessary Purchases
Your tax refund provides money so you can purchase things you need. Once your tax refund arrives, don't hesitate to use it for something you need. Don't think you have to spend it on something extravagant or special, use it towards those everyday expenses that add up.
For example, don't putt off getting contact lens refills or those new prescription glasses you need. Use your refund to buy what you already need and use AC Lens. They offer contact lenses and prescription glasses in a variety of styles and colors and guarantee you won't have to break your budget. Save even more when you use code PC10 and get 10% off. Make those necessary purchases and save that money for things you need down the road.
Avoid the temptation to use your tax refund on things you can live without. Spend your tax refund wisely, and you can get the most out of your refund.