Put Your Tax Refund Against Debt (or Other Financial Purposes)
Tax refunds are not free money; in most cases, you just paid too much with deductions. If you remember that your return is income that could benefit your financial priorities, you can resist the temptation to spend it. This is what we mean.
First priority: pay off your credit card debt. By allocating your tax refund to repayment of high interest debt, you get the most bang for your buck. For example, by repaying a loan at 18% per annum, you actually earn 18% on your investments.
If you’ve paid off your debt, you can use it to fund your emergency fund, make contributions to the Roth IRA, or start investing (if you haven’t already).
GOBankingRates has compiled a handy list of 7 tax refund spending priorities based on your financial goals and situation – all timely reminders before your tax refund arrives.
Here is the first thing to do with your tax refund | GOBankingRates
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