5 Best Ways to Put Your Tax Return to Work for You
You’ve paid taxes all year long, and now it’s the government’s turn to put some money back into your pocket. It’s tempting to use it on a shopping spree or pay for a lavish vacation, but there could be better ways to use your money.
- IRA Account: IRA accounts are ways for you to personally control where your money goes. It’s a safe and effective way to make your money work for you on the stock market. There are buy in rates that you have to achieve before you can apply. Once you do, you can choose from mutual funds, stocks, bonds, and other methods of investment. You can select the percentage of stocks and bonds in your mutual funds. The higher the stock ratio, then more money you stand to make if the economy is on the rise. Higher bonds are better for those who are older, or when the economy is in a recession.
- 401K: You can put extra funds into your 401K program. These are stock options that are offered through your job. The company usually matches or puts in a predetermined percentage from your paycheck. The 401K offers you mutual funds and stocks as well, but you don’t have as much freedom to select whatever you like.
- Pay of Debt: No matter who you are, odds are that you have some debt attached to your name. usually it’s from credit cards, or from making big purchases like vehicles. Eliminate your outstanding debt by putting your tax return money towards lowering the principle. The less you owe, the less interest you pay, saving you lots of money in the long run.
- Pay for School: If you have existing student loans, then now would be a good time to put money down on those debts to shrink the length of time you’ll pay for them. It’s not the most fun way to spend your money, but it’ll relieve a massive burden off of you once those school loans are out of the way. If you don’t have big loans, then consider investing that money into classes or further certifications.
- Buy Certification Courses: Use it to do some online learning on subjects that you are interested in, or on things that will pad your resume for a future promotion. If that doesn’t sound attractive, then you can spend it on lessons to gain a skill that you’ve always wanted to learn. Pay for music classes, art classes, dance classes, or cooking lessons. Use it in a way that will grow your skillset at work or in your personal life.
Making investments in the stock market or in yourself are fruitful ways to spend your money. You can still set aside some of your returns to treat yourself to some new clothes or to a fancy trip, but don’t forget to invest back into yourself. Clothes will last a season, but building yourself up will last a lifetime.