Today I came home from work and went to take the trash out. As I opened my apartment door, the UPS man was approaching with three packages for my roommate. Each package was shaped like clothing (the typical white bag with the USPS stamp). I knew she had been hitting up the Lululand (it’s a thing, girls, it’s a thing) Facebook re-sale page again! Every time I see her get packages, it causes me to re-think what I’m doing with my money and how she budgets. With “tax day” coming on April 17th this year, I thought it was the perfect time to give you a little bit more life advice: 5 Smart Things To Do With Your Tax Returns.
This one speaks for itself. Put some of it away. Here are some things you can do with your savings:
- Take a girl’s trip. My suggestions are to a tropical location – a cruise, Charleston, Florida or even somewhere foreign.
- Have enough savings you’re already ready to purchase Christmas gifts for your whole family in April.
- Think about your future plans. Are you buying a house soon? Do you need a down payment? Are you buying a new car soon? Wouldn’t it be nice to pay for it in cash?
The worst thing someone can have is debt. Here are some things you can do with your bill $:
- Pay off credit cards. Start with anything with a high-interest rate. The cards you open at stores are not as friendly as you think!
- Utilize all of your tax returns to pay your entire year of phone bills.
- Use your tax returns for your entire year of car payments (depending on how much you got back).
#3: Invest in Your Future
Starting to invest is something anyone in their early 20’s – onward should think about. Have you started a 401(k) plan? Do you have any money in the market? Here’s a big one: Do you want to get your master’s degree? Your tax returns could be a semester of tuition or more!
#4: Start An Emergency Fund
Growing up, I was always told you should have enough money for three months rent + living expenses saved. It’s a great general rule of thumb in case life catches up with you. Losing a job, moving or having something happen that causes you to need this money could happen at any time. Use this money as a jumping-off point for your emergency fund. I’ve also found this is great to have if you have unexpected car troubles. You never know when – like me last month – you will go through the car wash and your windshield will leak, leaving you in a puddle of water.
#5 Treat Yourself (smartly)
I’m not saying you should go on a shopping spree, but if there’s a pair of workout leggings or a Kitchen Aid Mixer calling your name – this might be the time 🙂 Investing in quality items is a good way to splurge.
You may not have extra cash on your hands the rest of the year, so spend your tax returns without regrets! Know where your money is going. Do you have any other ways you use your tax returns? I’d love to hear!