Yes. It happens to all of us. I mean, the dilemma often faced when confronted with some huge amount of money. Often, we become confused on how and where such money should be spent. This situation also holds true, when you get your tax refund! What comes to mind? Exotic vacations, travelling the world, sightseeing and so on, the list in our mind becomes endless. However, let’s take a look at some tips that would help you make the wisest decision on how and where you can spend your tax refund:
- Spend it on someone you cherish: It is often said that money cannot buy happiness, however, you would agree with me that, money well utilized can surely buy happiness. How? The amount of money you get from your tax refund could be best employed by spending it on an individual you love so much. This is advised because, the long-term effect of such display of love is invaluable and the happiness that results cannot be bought with money. You would forever be appreciated by such individual. Therefore, since your tax refund comes only once in a year, you would find it worthwhile to invest it in such a wonderful way.
- Buy things that are valuable in the long run: On getting your tax refund, it is quite important, that you calm down, talk with members of your family or your beneficiaries and map out those things that would be of very huge value to you in years to come. I mean, things you would look upon in say ten years and you would be glad you bought with your tax refund money. It is not advisable to start binge shopping or duplicating household items or personal accessories you already have, with your tax refund money.
- Pay down your credit card balance: According to financial experts, a very smart way of spending your tax refund is to pay down expensive debt on your credit card. Another useful insight on this was given by Ryan S. Himmel, CEO/President of BIDaWIZ Inc, here’s what he said: “By using proceeds from your tax refund to pay off that debt, you are reducing your interest”
- Make donations: It is very smart to donate all or part of your tax refund money. This is because, “Not only are you helping a good cause; you are reducing your tax bill” says Pfaehler.
- Have fun: Definitely, being advised not to spend money on those things you have secretly desired may sound inconvenient. So, here’s a suggestion. There is a rule called the “90/10 rule”. It means, take 90% of your tax refund money and use it exclusively for very important or responsible matters. Then, you can take whatever amount is left and use it to get that new gadget on the market, go on weekend getaways, enjoy fancy dinners and other things you term ‘enjoyment’.
So, there you have it! You can therefore settle down, make accurate decisions on how you are going to spend your tax refund money in profitable ways.
Check out this post for more informations: http://www.foreclosure-ny.com/5-ways-to-audit-proof-your-tax-return/