If you’ve got a refund coming, it’s time to plan for where you’ll use it. For those who aren’t great at saving money, a tax refund can be a chance to wipe out some debt or build an emergency fund. Managing it well can reduce your stress and improve your credit rating.
It’s recommended that everyone have $1,000 in the bank for emergencies. If you’re not good at saving, set up your account in an on-line bank that offers a higher interest rate than many brick-and-mortar banks and deposit that amount there. Then, ignore it. If you don’t need it, it can sit there and grow. If you have a real emergency, you can tap into it. For those who have an emergency fund, talk to an investment adviser about an IRA or a Roth IRA. Either savings vehicle can make your retirement easier.
There are many charities that are good stewards of your donations. You can donate locally or contribute to an international charity that matters to you. One in ten people in the world don’t have access to clean water, so giving to a charity that helps provide those in need with clean water could be a worthy cause. In addition, many who struggle with water access have to walk hours every day to find it. They then have to burn a lot of energy taking it back to their home. Imagine if those hours could be put to better use. By increasing access to safe, healthy drinking water, many lives could be improved and saved.
Self-improvement comes in many different forms. You could take a class to learn a new skill, which you could turn into a second income stream. If you struggle to build a workout routine that fits into your schedule, you could schedule sessions with a personal trainer and come up with a workout that suits you. For those who want to eat healthier, a cooking class can be a great investment. Anything that increases your skillset can improve your life. There must be many things you’ve always wondered about, so find a class and start learning the answers.
Your tax refund can be a stepping stone to a greatly improved life for yourself or someone in need. Set up that savings account. Make an appointment with a financial advisor. Find a charity that touches your heart. Locate a teacher who can help you build a skill you’ve always wanted. Use this extra money as a tool for personal expansion.