Tax time can be a little stressful. It is when you take a look at all the documents, expenses, and hopefully receipts, over the past year to see where you fall. The goal would be to have a $0 refund, which meant that you paid enough taxes during the year and received the most in your paycheck, but if you are lucky to get money back, try and spend it wisely.
Home DIY Projects
If you have not already been thinking what you wish you could do around the house if you magically came across some money, well this is your lucky day, so spend it wisely. With buying some higher-end paint, you can bring new life to a room, and adding a fresh coat of white for the trim and doors to really made it pop. Replacing the worn-out carpet can be fairly inexpensive to do as well.
Build Up an Emergency Fund
If you ever heard your parents say “put it in the bank”, this is one of those times when you get a little money that you want to spend, but need to hold onto it. Experts have long said that you should have between three and six months’ worth of expenses on hand in case of a job loss or event where you need money to fix an appliance or car repair.
If you are carrying a credit card balance over month-to-month there is plenty of interest being charged that could have been used elsewhere, so it is always good to pay off the balance each month, but in the event, that you have not been able to, then you should pay down debt with a tax refund. Some cards can have an APR of 16%, so most of your monthly payment could just be going toward interest and not putting a dent in the principal balance.
Take a Vacation
I am cautious saying this as it seems that I may be giving a nudge to blow the money but that is not it at all. If you stick to a budget and live frugal the rest of the year, then you may be in for a long overdue vacation that you are able to take for free with a tax refund. After all, it is important to save, but life experiences are as important to others as well, so make sure to still live life, without breaking the bank of course.
Donate to a Charity
Sure, this may not be the first idea that comes to your head when you see a check made out to you come in the mail and get you excited, but your donation could go a long way for those in need. There are endless numbers of charities that are out there, so give to one that you are most passionate about, whether it be child, animals, or research. If you are wondering what is in it for you, besides given to someone less fortunate, you will be able to write-off on your tax return, getting a little back when you file next year.