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Tax season has rolled around again and hopefully you’re expecting a decent refund. I’m here to remind you that a shopping spree is not in order! Try the following things instead!
Well let’s knock the obvious one first. According to CNBC, more than 50% of Americans have less than $1,000 in savings. If a medical emergency, surprise vet visit, or unexpected home damage pops up, most people wouldn’t be able to afford it. This would mean charging more to credit cards/taking out more loans and the vicious debt cycle continues.
Treat your tax refund as a bonus and literally put it all into a savings, off limits for random spending.
Contribute to an IRA
Have you started investing yet? Better late than never! You can contribute to a Roth IRA or a Traditional IRA, read about the differences here. Did you know contributing to an IRA may even increase your tax refund?! I opened one last year for that exact reason. For 2016 my income was low, so by investing $1400 into a Roth IRA, I received an additional $600+ return.
Either way it’s beneficial to begin contributing, because the sooner you start the more time you have for compounding interest to work it’s magic.
Pay off debt
If your on a debt free journey like myself, the idea of throwing a couple thousand dollars at your payments gives you a high. Unfortunately society teaches us that debt (especially student loan and consumerism debt) is normal. Well it is normal, but you don’t want to be a part of that normal!
Take a serious look at your debt and see if you should start taking it more seriously.
Put it toward a down payment
Looking to buy a home or car? Now you’ve got a good chunk to throw at your down payment! A larger down payment will save you a lot more interest in the long run and can help lower your monthly payment.
Renovate your home
If you’re looking to sell your home soon or you just need to spruce things up, you may want to invest in some home renovation! Paint the walls, get new counter tops, install new lighting fixtures, etc. These changes can increase the value of your home or maybe just your happiness!
Even if you just purchase a new bed or couches I see that as a positive decision, because it is the place you come to for comfort after all!
Take a course/get certified
NEVER stop learning! Sharpen or learn a new skill by taking a course. There’s tons of valuable options online these days, just make sure to do your research. You may even want to get a certification in something if it’s going to benefit you/your career. Some examples…bloggers can take an affiliate marketing course, a Pinterest course, or invest in a whole blogging community! Artists can enroll in a photography, drawing, or painting course. Learn how to invest in the stock market and stretch your dollars even more!
The options are endless and it’s always a good idea to be learning something new and to challenge yourself.
Invest in yourself
This doesn’t necessarily mean splurge on clothes or other materialist things, I mean to invest in things that are going to benefit your body and mind. Book a few massages, join a gym, get a facial, join a meditation group, purchase a couple of self-improvement books, get some quality vitamins and groceries. You get the idea!
Invest in your business
Investing in your business should actually benefit you more than you think. An investment makes you commit and work harder, because you don’t want to sacrifice the money that you lost. A new computer, a new camera, some nice light boxes, new props, a course, all can motivate you to work harder!
Related: How to Invest Your First $100
If you’re feeling generous, donate some of your refund to your favorite cause. Or you could even just buy some things to help your local animal shelter or families out! Generosity (though money is definitely not the only way to be generous) goes a long way!