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5 Wise Ways to Spend Your Tax Refund

by Redeeming Riches on March 9, 2012

Let’s be honest, we all enjoy tax refunds.  The oh so sweet check in the mail that makes us all smile.  While there is much debate on whether or not getting a tax refund is a good thing, I want to discuss various ways you can be wise with this new money.

Instead of wasting the money on a brand new TV, why not enrich your life instead?  Check these 5 ways you can maximize your tax refund and ensure that it’s not wasted on trivial things!

  • Pay down your debts!

Yes, this is common sense but you have no idea how many people don’t do this!  If you have any sort of debt, pay down the debt with your tax refund this year.  This is quite possibly one of the best ways you can use a tax refund.  Stop waiting around for someone to fix your problems.  Handle them yourself and become debt free in 2012!  You will be able to do other things with your money now and not have to worry about monthly payments.  This includes car payments.  Imagine having an extra $200/month, what could you do with that money?

tax refund

  • Weekend getaway

I’m a huge believer in enriching one’s life through culture and experiences instead of material goods.  I’d rather have a so-so car and go on trips instead.  At the end of the day, do you want a live a life full of experiences or be known just for your material possessions?  Take a Friday off and head out of town with your wife.  Hire a babysitter if you have kids and just get away.  Groupon is an awesome website offering massively discounted trips.  Don’t wait around for these things.  Life goes by too fast to not enjoy God’s creation.  Go do something!

  • Add to your emergency fund

I consider this option the most boring of the five but it is also one of the most important.  We never know when something catastrophic will happen in our lives.  Yes, it’s good to rely on the Lord for necessities but it’s also good to practice wisdom and prepare beforehand.  Create a goal for yourself and use your tax refund to boost your emergency fund.  It may not be fun but your wallet will thank you later down the road.

  • Home improvements

Is there a door that needs to be replaced?  Is there a leaky window in your condo?  Instead of spending your paycheck or going into debt to fix a home related issue, why not use your tax refund instead?  Go to Home Depot and play a game.  Try to fix your home related problem with only the money in your tax refund.  This will ensure that you spend your tax refund on something productive and will also ensure that you don’t go into debt for it.

  • Start a side business

There is no better time to start a business than with a tax refund.  Any type of business will require some start-up capital and you could use your tax refund to help ease the burden for this.  Starting a side business or a fully fledged business is a great addition to anyone’s portfolio of investments.  Turning a tax refund into additional dollars is music to my ears.

photo by stevendepolo

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