With the tax deadline looming, you may have already received your refund or are eagerly awaiting it. While it’s tempting to treat a lump sum of cash like “free money” and blow it on clothes, vacation, or a tricked out top-of-the-line golf cart, look at it as a withdrawal from a savings account you didn’t know you had. It’s your money, after all! Here are some smart ways to use your tax refund:
Add it to your retirement account. If you’re like many Americans, you might be a little behind when it comes to retirement savings. You might be able to receive a tax deduction if you put the money toward a 401(k) or IRA.
Use it for home renovations. Need a new roof? Been thinking about hardwood flooring? Guest bathroom looking a little dingy? These types of renovations could add resale value to your home, which is a great use of your money.
Pay down debt. Get rid of a big chunk of high-interest credit card debt. Make a big payment on your student loans. Any debt you have that carries a high interest rate should be eliminated as soon as possible!
Use it for a down payment. Interest rates add up, so a tax refund could be a big help toward accumulating the cash needed to buy a new home.
Start (or add to) a rainy day fund. If you’re relatively stable when it comes to paying bills and tackling debt, stash that cash away for emergencies. You’ll breathe a little easier knowing you’ve got a little cushion in the bank should anything disastrous happen.
If you think you might want to use your tax refund as a down payment, give us a call at 877.312.9033 and one of our awesome loan officers can talk you through your options! Now, go forth and make smart money decisions!