Every tax season, you receive a tax refund. You quickly spend the money on a shopping spree that includes buying clothes, electronics, makeup, games, and etc. You don’t even give your spending habits a second thought. However, this tax season you want to use your refund in a more responsible way.
Here are some ways to responsibly spend your tax refund:
Treat it Like a Paycheck
A tax refund is essentially an additional paycheck. It’s money the government owed you from your living wages. Before going out and treating it like lottery money, remember it’s just additional funds that should be spent on your everyday expenses.
Build an Emergency Fund
The smartest thing to do with your extra money is to not spend it. Instead, open a new savings account, and then put the entire amount in it. Use this money as the starting capital for your emergency fund. Every time you get extra money, put it in this account. Additionally, make automatic withdrawals from your checking account to your emergency funds.
Let the money stay in your savings account, just letting it grow until needed. Make sure to get an account that doesn’t charge any fees, so that your money can completely stay intact until used by you.
Pay Off Debt
Use the extra money to tackle some of your most financially strenuous debts. Decide whether you want to focus the tax refund money on all your debt, and … [Read the rest]