Ever feel like you cant get ahead? Saving at tax time may help you get started. Saving throughout the year can be tough. It may feel like every paycheck is spent before you get it. If thats the case, youre not alone.
Tax refunds may be the largest check you will receive all year, but are used as unplanned bonuses. Refunds are an opportunity to commit saving a portion to improve your financial situation.
Get the most value from your tax refund:
Pay down your debt. Use your refund for some much needed debt relief. Pay off your credit card balance. If you have an outstanding balance on more than one credit card, try to pay off the smaller, high-interest rate balances first. That will free up more funds to put toward larger balances. You can apply your refund toward other debts, like a car loan or a home equity loan.
Save for a rainy day. Why not give yourself an even bigger return on your tax refund by putting the money into a savings account, CD, or retirement fund? Your tax refund will continue to grow if you put it into savings or invest the money. Its always helpful to have a savings account to draw from when a major car repair bill, medical emergency or other unexpected expense comes along. That way, you dont have to borrow money and add to your debt-load.
Consider your financial goals. Trying to save for a house or car down payment? Hope to contribute to your childs college tuition? Consider applying your tax refund toward these goals. If you dont yet have a set of short-term and long-term financial goals, put one together. Youll be more conscientious about how you spend your refund or any other extra money that comes your way.
Remember, you work hard for your money and you deserve to enjoy a healthy financial lifestyle. Put some thought into how you use your tax refund. Making smart financial decisions is not always easy, but it will definitely benefit you and your family over the long term.
Joy Miller may be reached at joymiller@ksu.edu or 620-223-3720.
