Getting back a tax refund at the end of the year is always a real pleasure. While it might be tempting to use the money to buy that new watch you have had your eye on, there are better ways to spend your money. Today, we are going to learn three ways that you can make your tax refund stretch.
Pay Off Those High-Interest Credit Cards
If you are like most of us, you probably have a few high-interest credit cards in your wallet. If so, then why not use your tax refund this year to pay them off? This will not only free you from debt but it will save you money in the long run. When you set down and really add up all that interest you are paying you just might be surprised.
If you have cards with interest rates higher than 12%, you should really think about paying them down. If you have multiple cards, start by paying down the one you owe least on and work your way down the line. This will free up the monthly installment payments that you can use to pay off other debt with.
Invest in The Stock Market
A great way to use those income tax dollars is to put it in the stock market. To play it safe, make sure to place your money in older blue-chip stocks or penny stocks with a proven track record. Also, try to find some stocks that pay dividends. A dividend paying stock will give you interest on your investment in the form of bi-yearly payouts. Holding stocks will make you part owner of a company.
When the companies you invested in grows and starts to be prosperous, the price of the stock you own will rise. If you have kids, this will help teach them about money. Placing money in the stock market can be a fun way to teach your children how to invest.
Save For a Family Vacation
Have you been putting off that dream family vacation because you simply don’t have the money? If so, then why not put your tax refund into a vacation account? This will allow you to save up for your trip and gain a little interest at the same time. Plus, you can always add money to this account and when you have saved enough, you can take that trip of a lifetime!
Vacations with the family will build priceless memories that your children will never forget. Going on a vacation as a family can also help relieve stress and allow you to get away from it all.
Each of these tips is a great way for you to spend your tax dollars. Instead of buying material items that you will lose interest in, these investments will last for a very long time. So the next time you get your tax check, make sure that you wisely think about how you are going to spend it. It just might help you get out of debt or invest in a better future for your family.