Every year, millions of Americans receive billions of dollars in tax refunds. Many choose to spend their money on nice dinners, expensive clothes, and lavish presents. While we aren’t against treating yourself within reason, at Summit Tax Solutions, we believe that using your tax refund to get ahead financially is the best course of action. Here, we share some great ways to use your refund today.
Feed Your College Fund
Suppose you have children and plan to help them pay for educational expenses. In that case, you could use your refund towards their college fund. When doing this, CNFC advises using a tax-sheltered education account or a 529 plan, as this will allow the money to grow tax-free. This is also an option you can use to save up for your own education if you’re planning to go back to school down the line.
Pay Off Home Repairs
It feels like there’s always something to be repaired around the house. Whether it’s a remodel you’ve been putting off for a while, or urgent repairs that need to be handled right now, investing in your home is a great way to maximize your return. This is especially true because if you don’t fix that leak on your roof or get your insulation repaired, the problem can worsen and cost a lot more to fix down the line.
Contribute to Your Debt Payment Plan
According to Ramsey Solutions, over 77% of Americans are in debt. While paying off old loans isn’t the most glamorous way to use your new money, your future self will definitely thank you for it. Remember that the longer you take to pay off debt, the more the interest on it grows. Thus, it’s in your best interest to pay off your loans or credit card debt as soon as possible.
Invest In Yourself
If you have a big self-investment goal that you’ve never quite had the funds for, now could be your time. In addition, your returns can act like a startup fund that you can grow to an enormous empire. If you choose to go down this path, evaluate all aspects of your business model or decision. This should include audience research, product testing, and marketing efforts. Be sure to also reach out to contacts and mentors to gain their advice before going ahead. Investing a little bit of your return in printing new business cards will be helpful here, as potential clients and new contacts will have something to remember you by. You can design your own card using a free business card maker. All you need to do is choose from a pre-made template and then customize elements like image, text, color, font, and more. Simple!
Earn Some Good Karma
If you live on a tight budget, donating to a charitable cause may not always be your highest priority. But the great thing about tax refunds is that you weren’t expecting that money in the first place. Why not pay it forward to someone in need? This is a great way to give back to a charity you believe in or have always wanted to support. Charitable donations also offer their own tax benefits, which can be a sweet added surprise for next year’s taxes!
You’d be amazed at how far your tax refund can take you. With just a little bit of financial planning and preparation, you’ll find that your goals look more reachable and that you can save up for the important stuff. So get out there and enjoy your windfall - responsibly.
Looking for trusted tax advising services? At Summit Tax Solutions, we do business and individual tax preparation, as well as bookkeeping and payroll. Click here to schedule an appointment with us today!
Need help preparing your taxes? Summit Tax Solutions can help. Call 435-214-0123 to learn more about their services.
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