So, you followed our tax advice and were able to maximize your 2017 refund. You’re off to a good start, but what good is a big refund if you don’t spend it wisely?
While it may be tempting to take that refund check to the mall and spend it on a fancy new toy, you will thank yourself later if you exercise restraint and invest this money.
Here are nine smart ways you can spend your tax refund this year:
- Re-invest the money in a retirement account. Roth IRAs allow your money to grow tax-free and have no minimum required distribution, making them a popular choice.
- Pay off some credit card debt. Pay off your accounts with the highest interest rates first.
- Make an extra payment on your mortgage. If you are lucky enough to have no high-interest debts, consider putting your money towards your mortgage.
- Build your emergency fund. Your emergency fund should be able to support up to six months’ worth of living expenses.
- Put it towards your next big purchase. Whether you have a new car or home improvement project on the horizon, your tax refund can be used to pay off a significant chunk of it.
- Use it on your insurance policy. Upgrade your policy or just pay next month’s premium, the choice is yours!
- Invest in your career with additional training or an industry conference. You are your own biggest source of income, so it makes sense to invest in yourself.
- Make a charitable donation. Doing the right thing just feels good, plus it can reduce your taxable income for next year.
- Treat yourself. There’s nothing wrong with spending part of your tax refund on yourself. The key word is part: try to limit this spending to 10% or less of your total refund.
Whether you are looking to maximize your tax return, or just need advice on spending it wisely, the financial consultants at American Investment Planners, LLC are here to help. To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.
No comments:
Post a Comment