Tax Day doesn’t have to be bad. For those of you that owed on April 15 – it’s over! For those of us getting a tax refund, there are three wise ways spend it. Invest in yourself and your relationships – think spouses, kids and friends.
According to the IRS, the average tax refund last year was a whopping $2,860, which means you potentially have a chunk of change to spend. Heed this advice – adapted from Dave Ramsey – on how to divvy out your windfall.
- Put $1,000 in an emergency fund.
You gain confidence you can cover emergencies like car repairs, medical bills or a major appliance replacement. It creates breathing room in your budget and less stress. Next, pay off your smallest debt. Do you have a dental bill, credit card balance or small loan that needs to go? With one less payment, you’ll have extra money to put toward your next smallest debt later. Can you feel a debt snowball forming? - Buy an experience to use with someone you love.
Now that you’ve been responsible with most of your tax refund, it’s time to play. Money is no fun if you can’t enjoy it, so here are a few ideas to consider:- Take some of your refund and splurge on a fancy date night or modest weekend getaway.
- Buy season passes to your favorite local sports team for an instant, ongoing, pre-scheduled night out with the kids.
- Load up a gift card from your favorite restaurant or coffee joint to pay for lunch dates or caffeine fixes with your favorite co-worker.
- Sign up for a marriage retreat, yoga getaway or professional development workshop.
Put the focus on developing the things that matter to you personally and professionally. If there’s not enough money left for a workshop or retreat, buy some books on the topic. Commit to improving yourself.
If you’d like more advice on your financial future, reach out to Fidelity.
Source: https://www.daveramsey.com/blog/use-tax-refund-marriage