5 Ways to Maximize Your Tax Return
By: Good2GoPublished: March 3, 2016
Get caught up:
The single best thing you can do with your refund is to pay off high-interest debt. If you are lucky enough to not have any high-interest debt, catch up on any outstanding bills that are sitting on the back burner. From cable to medical bills, many of us could benefit from a little extra cash. Hit the “reset” button and try to get as debt-free as possible.
Help your kids out:
If you are a parent, there are a number of ways you can help children of any age prepare for their financial future. For younger children, you can set up a Roth IRA that they can contribute to later in life. Or, you could start a college savings fund. For older or adult children, your refund could be a loan towards a car or house for your child.
Set up a vacation fund:
Set aside some money for a vacation rather than using your credit card and paying interest long after you have returned. Stash your refund in a separate account so you’re not tempted to use it for other life expenses. Then add money automatically every week. When you’ve reached your goal, you’ll be able to pre-pay for your vacation, and avoid that pesky interest.
Invest in home improvements:
Your refund won’t be enough to completely revamp your kitchen or bathroom, but it can pay for some smaller home improvements. Use the extra cash to add a backsplash, paint a room or cabinets, replace your bathroom sink, swap out your faucets, organize a closet, or spruce up the yard. These seemingly small changes could make a big difference in how much enjoyment and pride you get from your home.
Fill gaps in your insurance:
Use your refund to purchase an additional liability policy that will help protect you legally if someone is injured on your property or by your car. Or, use your refund to pay off a new or existing auto policy in full for the next year – paying one lump sum often decreases your overall payment, which could allow extra cash flow each month for other expenses.
No matter what you decide to do with your tax return check, make it count! Many let their tax return checks get sucked into other accounts and it dissipates without making much of an impact. Whether a great vacation or a paid-in-full car insurance policy, your tax return is an opportunity – take it!
If you would like advice on how to use your tax return to purchase a new auto policy, the experienced and friendly staff at Good2Go is here to help! Call today or visit our website at www.good2go.com.