10 Smart Ways To Spend Your Tax Refund
It’s tempting to use tax refund cash tosplurge on some fantasy indulgence. Instead, consider this your opportunity to get your life and house, literally, in order. The average tax refund in 2009 was $2,683. Follow these next 10 tips, and you’ll see a return on your investment for the long haul.
Invest in you. In today’s market,ou need to continue adding to your skill sets or risk becoming a career Neanderthal. Advance your career by learning new computer skills, or discovering how to use social media for promotional purposes, or expanding your entire network (and get a tax write-off) by attending conferences.
Continuing education courses are a first-rate way to upgrade as they’re comparatively inexpensive. Community colleges also offer independent course work and many computer-training companies teach short classes that can swiftly add to your job worth.
Boring as this sounds, it’s the single best investment you can make, considering the high interest rates and fees that come with many credit cards. You’ll also be investing in your peace of mind as nothing creates stress like unwieldy debt.
Again, not a thrilling option but a good one if you’d like to be around awhile. An annual checkup for both your body and teeth can save vast sums in the long run. It’s also another way to create peace of mind.
Whether you own or rent, an energy audit can help you save big bucks on utility costs, a gift that keeps on giving. A minimal audit – from $25 to $200 -- can reveal where you should seal leaks, improve power usage, add insulation and more. Then, once you’ve identified problem areas, you can take advantage of the government’s energy tax credit.
Replace your water heater or furnace before you’re facing a mini-flood or freezing house. Tackle maintenance projects you always said you’d get to one day. Replace outdated appliances and aging roofs or simply landscape your yard.
Experts recommend setting aside three to six months’ worth of expenses in case of an emergency. The sum should be based on your fixed expenses, including mortgage or rent, utilities, food, loan payments, medical costs, etc. The base amount should be roughly $1,000 then you can work your way up to the total necessary amount. Keep your emergency fund in a separate savings account so you’re not tempted to dip into it for other expenses or treats.
Since no one likes to think about the inevitable, many of us put off investing in life insurance. If you wait until you’re older, the premiums increase and the return on investment isn’t as good. Term life insurance is probably your best bet. Life insurance is particularly important if you have family who depend upon your income.
Begin by maxing out any accounts that include an employer match; this is like free money where you’ll get the best bang for your buck. If such an option isn’t available, consider starting an IRA, which offers more control over your investment options than a 401(k).
It doesn’t take much to begin investing, whether through managed funds, shares of stocks, or other methods. A Managed Investment Scheme (MIS) is a good place to start as a tax-effective option. It can help you manage taxes while building a healthy portfolio. Talk to a financial adviser for more information.
An ounce of prevention is worth avoiding that dreaded “Check Engine” light on your dashboard. “Click and Clack,” the hilarious hosts of NPR’s popular “Car Talk” radio show are a great resource. Their website is full of suggestions about what you can handle yourself and what you should leave to a professional mechanic.
Source:Specials