So you get the word that you are going to be receiving a tax refund this year. You should go ahead and plan for what you would like to do with that refund. Here are some ideas we recommend doing with your refund that don’t involve going out and blowing it.
- Pay off as much debt as you can.
- Put money into savings account for emergency fund.
- Fund your retirement account.
- Start a new business.
- Funding kids college tuition.
Obviously the things listed above can be taken care of in different ways depending on your refund and where you are at currently with each area. We would suggest using your refund towards the above goals and also budgeting your finances to try and definitely take care of #1 and #2. Those two areas are very important and should be taken care of first if you want to have financial freedom and even want to look at the other suggestions. Also, you might consider getting with a CPA to do a little tax planning to help minimize refunds. By doing this you get your money throughout the year to help you towards the above goals. If you have any questions in regards to budgeting, how to tackle #1 and #2, or just advice on which area you should focus on please contact us.