Catchy title!!” Taxes are done, what should you do with your refund?” Pure poetry.
All kidding aside, it is lovely to dream of a spending spree when you get that nice, fat tax refund check. A down payment on a car, sassy shoes, a cruise..all those things sound great, don’t they?
Then there is the practical advice, pay off your credit cards, pay down your student loans, save the money for retirement..All sound advice, but no fun at all.
How about you do a little bit of each? Let’s say you are getting a refund of a few thousand dollars. It might be fun to put aside some of the money for a long weekend away. It would also be very practical to pay down some debt. You might sleep better at night if you used some of the refund to pay off a credit card with the smallest balance. I know, it’s always financially more prudent to pay off the card with the highest interest rate, and that is always sound advice, but if you are carrying a hefty balance on that card, it doesn’t feel quite the same as when you pay off the card with the lowest balance. AND then, you can allocate a higher monthly payment amount to the card with the higher interest rate.
Take another portion of the funds and put it in savings, and if you work for a company that has a savings plan, sign up to have a few dollars from each paycheck put into that same savings account. That way, if you get hit with a big expense, instead of having to put that on a credit card, you can use the cash you have saved.
Combine the fun and the practical. That way the money will have gone to something which gives you pleasure, which you won’t regret when a big bill comes due and you don’t have the cash on hand to pay it.
Anthony and Matt can also help you plan for next year’s taxes. If you have business deductions or personal deductions which could allow for you to pay lower taxes and keep more money in your pocket all year long, I think you might like to do that!
McCain and Samons