Wow, it’s March already, and I bet that many of us have started receiving those tax refunds in the mail. For some of us, it’s not that much,while for some of us, it’s a whole lot of Big Money. Whichever category, you are in; remember that you need a good plan for your money. The important thing is that many of us have started planning on how to spend it; but I have these tips for those of us that want to give the refund a PURPOSE, because if you don't do this, you will find out that you have nothing to show for your refund at the end of it all.
Here are some tips about what to do with your Tax Refund Money:
- Start (Add to) an emergency fund: It is always good to set some money aside for a rainy day. It is good to start off this fund with your Tax Refund, because if you decide to store that much, away from your regular paycheck or income, it will take you months or even years to make a significant deposit in your emergency fund.
- Pay down a Debt: If you have a lot of debt like credit card debt, title loans, car notes, student loans, hospital bills, payday loans amongst others, this will be a great time to put your refund to work by paying off these debts and eliminating your debts. You will discover that you will have so much peace of mind when you do this, and peace of mind goes a long way in keeping up a good health.
- Invest It: You can invest your Tax Refund in yourself, your business, your children or your family. Investing in yourself can be in form of getting an education, career training or personal improvement; you can also give your family a treat and splurge a little bit, but don't over indulge.
- Refinance your Mortgage or Make Home Improvements: When you refinance your mortgage, you will still pay closing costs and fees, use your refund to pay for the closing costs, and you will save thousands of dollars per year on mortgage interest. If you are happy with your mortgage rate, take a look around your house, to see how you can improve your home with some energy saving appliances. Remember that it is good to spend money now to save for later.
- Give to a Charitable Cause: Giving some of your Refund to a worthy charity is a great idea, more so when that donation is tax deductible, everybody wins. For some people, giving to charitable organizations is non-negotiable, but on a tight budget, donations can unfortunately go down to the bottom of a list, but you have to note that contributing to charity is an excellent use of capital and provides a huge spiritual and societal benefit.
- Start your Own Business: Perhaps, you have been looking for seed money to start off your long desired Business or take it to the next level; you can use your refund to get you moving in the right direction. It is a great opportunity to turn your refund into income for years to come and get a few more small business tax deductions next year too.
- Put it into an IRA or workplace retirement Account: Using your refund to get a head start on Roth IRA contributions is a great move, it can let your three-digit tax refund grow into a four digit addition over the course of the years, in addition, it is like using your refund to create a tax deduction.
- Create your own food bank: We know that it is cheaper to cook your meals than eating out, but the problem, might be the need to stock up on Food Supplies, many people struggle to find money to build this up, when they are living from paycheck to paycheck, but this is the best time to change, and stock up your home with food (both perishable and non-perishable).You will be surprised at how much savings, you will make and for many months to come, you would not have to think of eating out or buying food stuffs.
- Improve your Health: This is the best time to schedule that appointment to see your Doctor, Optometrist, Dentist or Physical Therapist, many people have been putting off these appointments during the past couple of years due to employment or insurance problems; perhaps you should use some of your refund to improve your health.
- Fix Your Car/Buy a New One: This is the best time to take your car for a Car Service, if you have not done that in a while, or alternatively even get another car, if your previous one has been giving you problems, you will be glad you did, because every time, you drive in it, you will remember that you used your refund to get it or put your car in that great condition.
- Pay up your Bills in Advance: There are so many bills, that we all pay from month to month, including our mortgages, insurances, child care expenses, utility bills and telephone bills; Instead of thinking of how we can scale through paying these bills as each month is approaching, we can pay up a couple of months ahead, so that we can relax and use the free funds from the following month for whatever we want to do. This sounds great right?
- Establish a Financial Strategy: Do you realize that working with a financial adviser can help you manage your tax refund and show you areas, of investing it and how to get great returns from your investment, You can always call on us at ROSYAN BOOKKEEPING SERVICES to show you how to manage your refund and get your ultimate returns on investments.
Please feel free to let us know how you have spent your tax refund or how you intend to spend your tax refund, and we can also advise you on how to make the most from it. For those of us ,that are not getting refunds, how do you ensure that you are ready to write that check to IRS on tax day?
CALL US TODAY ON 202.422.4586.You will be glad you did.