Tax Season Tips

Wondering how to effectively use your tax return to your advantage? There are plenty of options, but here are some tips on how to financially keep yourself in check by using this extra money to the best of your budget.

Take care of your emergency fund

One of the keys to financial stability is having an emergency fund with at least 3-6 months of living expenses. This is essential because it can prevent you sinking from a financial disaster. If you haven’t already started your fund, get a head start with your return, or if you’ve been dipping into your fund for additional cash, replenish what you’ve used and have peace of mind knowing that you have enough to withstand turbulent times.

Pay off your debt

Debt can have a crippling effect on your financial goals. Using your refund could help jump start you to a debt free life! Eliminating debt can be a difficult task to do all at once so we recommend prioritizing how you pay down your debt. Focus on getting rid of the small amounts first, then work your way up to the larger amounts.

Invest in your retirement

The golden rule of retirement is to save 15% of your income. If you’ve been putting off getting started or have fallen behind, your tax refund is the perfect opportunity to build up this important life goal. Whether it is through your employer or opening your own IRA account, everything helps.

Invest in your future

Once you have the other areas covered, you can begin to think about those long-term dreams. Maybe you want to further your education or start a new business venture. Investing in yourself to increase your knowledge can provide value and turn your interests into income. Another way to help your family could include setting up an UGMA/UTMA account or college plan for your children.