Are you anxiously awaiting your tax refund? Sure you are, but before you go out and splurge on a coffee from Starbucks or buy a keg and throw a party, consider finding a more practical use for your newfound money.
In a recent post, we gave you frivolous ways in which to spend your tax returns. But you are a practical person, so you are considering spending your extra money on paying down debt or perhaps opening a savings account. Good for you! You were even keen enough to hire tax services in Greeley to maximize your return.
If you are wondering the best practical ways to utilize your tax return cash, we can help.
Many of you will think this is a rather boring way to use your refund, and you would be right. But when you run into an emergency down the road, you will be glad you had the funds to help.
Seriously, if your car breaks down and it’s going to cost your $1,000 to fix it, wouldn’t having that money handy be a nice change of pace?
Pay Down Debt
Granted, using your tax returns to pay down debt isn’t as glamorous or fun as taking a vacation to a tropical paradise, but it’s good for you in many ways.
Paying down those credit cards will save you thousands of dollars in interest and paying down your car loan will knock years off your payments. Most people have some form of debt that they could pay down with their tax return dollars.
Open a Savings Account
You won’t make a whole lot of money off saving account interest rates, but you know your money is safe and available when you need it.
Save for a Known Future Expense
Now is the time to be proactive and put aside money for something you know you will be needing in the future. For example, your washing machine is on its last legs and it’s only a matter of time before it will need to be replaced, now is when you start saving up for it.
There is something around your house that needs to be either repaired or replaced. Your home is your biggest asset, which justifies spending money on it. So there is nothing wrong in using your tax returns to replace your furnace or have your stove fixed. It would even make sense to replace those drafty windows with energy efficient ones that will save you money in energy costs.
It might not happen until 2057, but hopefully, you will retire someday. And the chances of you retiring with enough funds to live life the way you dream about go up when you start planning for the future right now. Most Americans don’t max out on their retirement accounts, so there is definitely room to make more investments.
If you have kids, they do get older and before you know it, you will be looking into colleges. Investing in a college fund will help defray the steep costs of college while providing a tax break.
Start a Small Business
It doesn’t take a whole lot of money to start up a small side business. You could even try your hand at writing blogs.
Invest in The Stock Market
Take your tax return money and invest it in a company you think will go places. You never know, you might wind up scoring big by investing in the next Microsoft or Google.
Go Back to School
It is never too late to further your education. Perhaps you never finished college, use your tax returns to finish that last semester.