Thursday, March 12, 2015

Use that Tax Refund!

Tax time may not be your favorite time of year, but if you’re expecting a refund you can use that money in a variety of ways to improve your current lifestyle.  While getting a refund feels good, financial experts agree that the best way to leave tax season is by breaking even. A refund means the government is giving back your extra money that you could have been saving and building interest on all year. However, if you do get a refund back, here are three ways to put it to work for you.

Down payment on a new home.  Use your tax refund towards a down payment on your new home. 
The average tax refund of $2000-$3000 can be a nice bonus towards your new home savings plan. If you’re a few years away from buying a home, years of saving your refund will help making the down payment easier.

Pay off debt.  Take the money and use it to pay off debt or make extra mortgage payments. Pay off a chunk of that student loan or get rid of credit card debt.

Save for retirement.  Place your refund into your retirement savings 401K or IRA. Your refund will continue to grow over time as interest accumulates. The earlier you begin saving the better!

These are just a few of the ways you can put this “found money” to work for you. What plans do you have for your tax refund?

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