Smart Money Moves for Parents That Will Optimize a Tax Refund
Receiving a tax refund always comes with questions about how best to spend it, and trying to pinpoint the best option can be overwhelming. As a parent, you want to ensure that you're using that extra money wisely and making the most of it both now and in the future, but where do you begin? Speedy Tax Preparation & Bookkeeping Service shares a few options that you might consider.
Further Your Education With an Online Degree
If you're interested in learning something new, take this opportunity to invest in yourself by using a portion of your tax return towards an online degree program. Now is the ideal time to enhance your education and gain skills that can help propel your career forward, and an online program makes it easy to learn even as a busy parent. If you enjoy working with kids, then consider a degree in education. Once completed, this could help you to get a job you are passionate about and that will also give you some additional skills to help your child through their schooling.
Prepare for Retirement
Investing in retirement funds is something everyone should consider doing at least once during their lifetime. Using part of your tax return money towards opening/adding to existing retirement funds can help ensure financial security down the road, giving you peace of mind. Plus, many employers offer matching contributions, which makes investing even more worthwhile.
Start an Emergency Fund
You can also start preparing for unexpected expenses in the near future. Having an emergency fund is essential for everyone, especially if you own a home. Put aside some of your tax return money into savings so that you are prepared for any unexpected costs or emergencies that may arise in the future, such as large medical or veterinary bills or home repairs.
Make Smart Home Improvements
You can also make some changes to your home right now rather than waiting for unexpected repairs to pop up. Putting some of your refund toward making home improvements such as painting walls, replacing carpets, and installing new appliances can help increase the value of your home while also providing much-needed updates and repairs around the house. This is a great way to improve the look and feel of your home without spending too much money upfront. Take a look online at some of the best DIY projects that you can tackle without going over-budget.
Pay Down Some Debt
Using some of your tax return money to pay off debt can be a great way to save money in the long run and free up extra cash each month. Consider putting some of your refunds toward paying off credit cards, student loans, or other types of debt so that you can start fresh financially. Keep in mind that if you're going to make a large purchase soon, such as buying a home, credit changes can make a big difference in your loan approval rating.
Save Up for a Home
Saving up for buying a home takes patience and planning, but your tax refund can help the process along. Take a look at your loan options, as there are several factors that will play a role in your down payment amount, including where you live and your veteran status. Depending on these factors, your down payment amount might be as little as 3.5% or as much as 20%.
Apply Your Refund Strategically
Planning how to spend a tax refund can take some time, especially if several things need financial attention at the moment. Take your time making a decision, and do some research so you'll be prepared for major life changes such as going back to school or buying a home. With some careful thought, you can spend your refund wisely.
If you’d like help with your taxes to ensure that you get a refund, contact Speedy Tax Preparation & Bookkeeping Service today!