5 Ways to Make the Most of Your Tax Refund

If you are one of the lucky ones to have paid enough taxes through the year to net a refund you can rejoice.  Filling out a W-4 from your employer can give you a good estimate of taxes that are to be paid throughout the year whether you are single or married, have other dependents or deductions.  Throw in any self-employment income and it can quickly throw your tax return out of whack and get you in for a big surprise when you file.  While a refund means that you paid too much taxes throughout the year, it is nice If you come into some extra cash around tax time, so be sure to put it to good use.

Pay Off Debt

This should be common sense to pay down/off debt first, but unfortunately for most it is not.  You have some extra money get direct deposited into your account for your refund and the first instinct would be where can you spend it as fast as you can, as it is new found money.  If you are carrying a high-interest credit card, this should be the first place where your refund should go.

Put a Stash to the Side

Many experts have long said that you should have an emergency fund of three to six months’ worth of expenses in an account to cover an unexpected home or auto repair, even an unfortunate job loss.  Others have said that you should not keep too much saved and could be better used investing.  Regardless of how much, it is good to keep money off to the side in case you need cash for an emergency, instead of putting on a credit card.

A Little into Your Home Goes a Long Way

You can pick up a high-quality, one-coat gallon of paint for under $50 that can transform a room that has badly needed an upgrade.  Throw a fresh coat of white on the ceiling and molding and you have a brand-new room for hardly anything more than your time.  Outside landscaping can be brighten up with new plants and flowers, giving plenty of curb appeal for little money.  Even if you do not plan on selling, fresh updates can keep you interested in your home and give a clean to start spring and summer.

Put into a IRA

Going along with those that feel you should not keep too much in a savings account, if you open a Roth IRA that will let you grow your money tax-free, contributing the maximum of $5,600 a year will allow your money to grow annually to build up for you to enjoy and live off of your retirement savings.

Take a Vacation

You do need to take care of yourself, after all, you do work hard throughout the year, and if you are in good financial shape taking care of some of the items mentioned in this article, then I see no problem spending on a vacation.  Hey, using this money is better than putting on a credit card, not being able to pay off right away.

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