Your taxes are done and the word is you’re going to receive a healthy refund. What to do, what to do, what to do… Well, before you get hooked on getting the latest iPhone or few days off at the resort of your choice, think about investing the money you receive. Though the economy’s slowly recovering, remember the bad ‘ol days… wouldn’t it be nice to have a little cushion using money you didn’t necessarily earn?
$1,000 and higher
If you struck tax refund gold this year, what about investing that money in paying off debt? With $1000 or more, you can certainly use it to put a pretty sizable dent in your credit card debt or even better, get off the credit card train altogether and start fresh on that new fiscal year budget. You might also want to consider investing returned money in a mutual fund or a Roth IRA fund. With any of these options, you’re guaranteed an almost instant return on your money, since the IRS rewards those who invest in certain retirement funds, guaranteeing an even bigger return for next year.
That’s a hefty chunk of change right there. Good uses include investing in a high-yield savings account, or seed money for your kid’s college fund. One use saves some money for a rainy day, and the other gets you a nice jumpstart on investing in your child’s future, making spending money on a new phone or a tennis bracelet seem even more shortsighted than it really is!
This is the ideal amount of money for investing in keeping small problems from turning into big ones. Does your car need a new brake job? Why is the home air conditioner making a rattling noise? Now you have the funds that will hopefully make you brave enough to find out. Other uses could be a special allowance fund for the kids, so you can get on with the task of teaching good work ethic and the importance of managing, investing and saving money.