Wisely Handle Your Tax Refund

Although there have been some changes in the tax code for this year, you may be getting a tax refund. It’s tempting to use that “windfall” on a splurge purchase or spending it some other way that may seem fun at first, but may make you feel regret later.

tax refund

Here are some ideas that we think are better ways to use your tax refund.

Smart Tips for Your Refund

Pay Off Some Debt

You should’ve known this would be our first suggestion! Use that money to pay down or pay off credit card balances, loans, or other debts. You will make smarter use of your money by paying off high-interest accounts rather than sticking it in a savings account. In addition, once you pay off the debt, you will have one less monthly payment to take out of your income.

Emergency Fund

There are so many things that can happen to your finances that will leave you vulnerable. Car repairs, job loss, health issues, housing problems, the list is long. The majority of Americans don’t have an adequate amount of money in savings (if any!) to cover unforeseen events. You may have to take out a short-term high-interest loan or put the money on your credit card. And that is if you can even get approved for a loan or credit card. By starting or adding to your savings you can protect you and your family from financial emergencies.

Insure Your Life

If you’ve been more concerned about staying financially afloat, you probably haven’t thought much about life insurance. There is no better time than now to get it if you don’t have it or get a better policy if you already have insurance. Term life insurance is affordable, so by using your tax refund, you can get pretty decent coverage for you and your family.

Use Direct Deposit

If you are receiving a refund, take advantage of the direct deposit option offered by the IRS. If you don’t see the money, you’ll be less tempted to spend it. In addition, you can open an account at a bank that isn’t easy to access and deposit a portion or all of the refund. By doing this, you will be less tempted to dip into the money for those purchases that you’ll regret later.

Let Consumer Credit of the Quad Cities Help You

Before you dig yourself deeper into debt, connect with the experts at Consumer Credit of the Quad Cities today to help you get ahead. We look forward to working with you!