If you’re one of the many that receive a tax refund, here are simple ways you can spend it that can help your overall financial picture, according to a Forbes article by Kristin O’Keeffe Merrick.
While a “refund” is merely an over-payment of taxes from last year, it’s always nice to receive a check in the mail.
Here’s a highlight of the 6 tips from Kristin’s Six Smart Ways To Spend Your Tax Refund article:
- Pay Off Your Credit Cards. This is an easy opportunity to cut down credit card debt and spare the woes of compound interest.
- Pay Off Some Of Your Student Loan. If you have one, paying off a portion of your student loan will put you in a better position for this year.
- Create An Emergency Fund. Was the recent bill from your auto mechanic higher than expected? Worried about the weddings you have to attend this summer? Use your tax refund as a short-term liquidity salve. If you don’t have any savings but are debt-free, use this as a golden opportunity to start one.
- Make An IRA Contribution. Were you a late bloomer in the retirement account game? Are you behind on contributions? Do you have an IRA? Use this refund as a chance to open a retirement account and make a contribution.
- Invest Your Refund. Use this as an opportunity to start investing your money. You don’t need to have a ton of money to be an investor. If you’re going to do this on your own without an advisor, make sure you do your research.
- Take Care of Yourself. Do something meaningful for yourself and your family. After all, that’s why we work in the first place, right?
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