Saw this list come out on the best ways to use your refund money, and thought I’d use it as an opportunity to live vicariously through you guys since I’m getting squat this year 😉
Though by no design of my own as I LOVE getting a nice chunk back every year and thinking about all the ways to power your goals! Even if it’s your own money we’re talking about! (And let me tell you – after just maxing out our Roth IRAs yesterday, it’s a LOT more fun using your “free” tax money than it is your “normal” money, haha… I felt the sting hard this time!)
So if you’re not one of those “I don’t give the government a free loan” type people, which is fine if you’re actually APPLYING THAT MONEY towards your goals every paycheck!, here’s an excellent list of ways you can use your newfound money for good. [Also here is an updated IRS tax refund schedule, so you can check when you might anticipate your refund!]
Per MyBankTracker.com, with comments from yours truly:
The 10 Best Ways to Use a Tax Refund
- Build an Emergency Fund – Excellent route for anyone just starting out in their journey!
- Pay Down Your Debt – An excellent route for anyone no matter *where* they are in their journey! Especially if we’re talking about debts with 10%+ interest rates!
- Fund Your IRA – My go-to answer every year – with or without a tax refund 🙂 Even if this was all you ever did every year you’d have hundreds of thousands to your name by retirement!
- Invest – Another great option, which I’m assuming refers to non-retirement accounts since of course most of what you do in retirement accounts is invest 😉 But maybe this could be a fun side pot to poke around and experiment with? Especially since again it feels like “free” money and wouldn’t affect you as much if you were more risky with your everyday money?
- Pay for Home Improvements – Or perhaps home improvement “wants” vs needs? 😉 Especially those that’ll increase the value of your home over the years?? I remember once someone telling me you should do all of them while you’re *living in the house* vs before you go to sell it so you can actually ENJOY all the upgrades you do! Something we failed big time when we sold our first house, and now every time it pops back on the market and we see all those beautiful hardwood floors and kitchen cabinets I get sad that we never got to appreciate them 🙁
- Replace an Old, Inefficient Appliance – Sure, why not?! And pick up one that’s energy star compliant to help save the earth – and your electric bills – at the same time!
- Invest in Yourself – I always find this one the hardest to do regardless of how you come into cash, but I agree we need to be better about taking care of ourselves, both in terms of our minds/brains/bodies, but also just in our general well-being too. And a tax refund can be the perfect opportunity to treat yourself here that you might otherwise never do.
- Save for an Upcoming Expense – My Bank Tracker lists stuff like irregular expenses or real estate taxes (yaaaawwwn), but maybe you can stash some for more exciting expenses that are on the horizon if there is such a thing 😉 (Road trip? International vacay!?)
- Make a Charitable Donation – And then get a tax write-off too! Hah! (Get it? A tax write-off on your tax return??!) But yes – an excellent idea as this world needs as much help as it can get these days… And might I recommend a few places I’m proud to support:
- SundaraFund.org – An organization that recycles old hotel soap into new soap for those who don’t have access to any around the world, or even know what soap IS?!
- Breadcoin.org – A new currency of tokens you can hand out to those in need, redeemable for food at local merchants here in the DC area.
- TheGoodCemeterian.org – A two-person preservation team that restores old tombstones and then shares the stories of the people they honor to help their memories live on.
- The J. Money Fund — a charity I’ll one day finally create again!!! 😉 It’s been almost 10 years since our first one: Love Drop! (Anyone still around from those days?)
- Treat Yo’Self – Buy Something Fun – The only place where I’ll keep this on the list since I know most of us actually have the *opposite problem* here of wanting to hoard all our money! Haha… So if you haven’t done something nice for yourself lately, go ahead and splurge a little and then get right back to the Goodness again to keep your sanity 😉
And btw – this doesn’t have to be a “one thing” only type deal either. Mix and match it up depending on your personal preference! For some that’s going “all in” on one main goal and killing it, while others like to spread out the love and hit upon a few different areas that excite them…
What matters most is that you’re using this money MINDFULLY, which I find is a lot easier to do when you get big chunks of it vs smaller ones throughout the year that tend to get lost in the shuffle.
So if you’re one to be getting a nice refund back this year, embrace it! There’s nothing wrong with it no matter what people say… It’s mostly us $$$ nerds that raise a big stink about it, haha….
Now make me jealous and tell me everything you’re gonna do with your money!! And bonus points for sharing *how much” you’re getting back to really rub it in! 😉