Constructive Ways to Use Your Tax Refund

 

The IRS distributed more than $305 billion in tax refunds in 2020, with the average taxpayer receiving just under $2500.1 This is a substantial amount of cash! Rather than pocketing the money, use these tips to put your refund to work.

Stock Your Rainy Day Fund

Keep the money in your emergency fund to anticipate unexpected issues like job loss, health problems or home/car repairs.

Invest

Consult with a finance professional to learn your options should you want to invest in mutual funds or stocks. Thinking of investing in real estate? Put the money toward a down payment!

Save for Your Kids’ College

Contribute to a college fund for your children or grandchildren. Placing the money in a 529 plan is a great start — this is an account for education expenses only.

Renovate Your Home

In need of an upgrade to your kitchen or bathroom? Your tax refund can kickstart  the project — and help you boost your home value when you’re ready to sell.

Chip Away at Debt

Cut down on student loans or credit card debt — especially those with high-interest rates.

Contribute to Retirement

Think about opening a traditional or Roth IRA and leaving the money there. These assets will build over time and set you up in your golden years.

Personal Development

Invest in yourself! Take an online course to improve your skills or find a personal growth webinar that works for you.

Work on the Mortgage

Consider prepaying part of your mortgage — a little extra payment goes a long way.

 

Need a tax professional to keep everything straight this tax season?

Call me for a great referral!