(DailyDig.com) – Tax filing season may be over, but the Internal Revenue Service (IRS) is far from done sending out refunds. It may be tempting to go out and buy a bunch of stuff with that kind of dough, especially since Money.com reported the IRS said the average refund is more than $3,000 for the 2021 tax year. Here are some great ways to make the most of it.
Here are 7 money-savvy ways to use your tax refund! https://t.co/NDYyUpZ8UI RT @Wealthtender
— Small Biz Tipster (@biz_tipster) May 3, 2022
1. Pay Your Bills
With inflation through the roof, it’s common for people to fall behind on at least one bill. That means the first priority for your refund should be to catch up on any past due payments. If you’re lucky, there may still be some of your refund left over. Perhaps consider paying down some credit card debt.
2. Save
There’s a reason you fell behind on your bills. To stop it from happening again, be sure to use this year’s refund as an emergency fund, or perhaps for a long-term goal such as buying a home. It’s tempting to buy everything you want, but it may be wiser to only spend a fraction of that money on personal items.
3. Invest
You don’t necessarily need to take your refund to a stockbroker. Instead, invest the money in yourself, in a retirement account like a 401K or Individual Retirement Account. You could even invest what remains of your refund after taking care of other expenses.
Ultimately, the choice is yours. These are merely suggestions on helpful ways to utilize the cash windfalls many Americans receive in the form of tax refunds. Just remember, it will be a long year between now and the next tax season.
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