Build or Strengthen an Emergency Fund
You can never be too careful or have too much money in your savings account. Although putting it straight into your savings account is probably one of the least fun ways to use a tax return, this is a solid way to set yourself up for financial success and protect yourself for the year to come.
Give Yourself Financial Freedom
Who doesn’t want to be debt-free? Even if you feel like your tax return money will hardly make a dent in your debt, trust us, it will. Every dollar is a dollar closer to being debt-free and having financial freedom. If you have big goals for the future, like purchasing a house or paying for a child’s college, putting your tax return towards your debt can be a big first step to getting there.
Invest in Yourself
If you’re already comfortable with your emergency fund and aren’t saving up for anything big in the future, invest the money in becoming your best self! Put your tax refund towards online college classes or lessons for a new skill you’ve always wanted to learn. You could use it to hire a personal trainer or purchase some home gym equipment. Some “outside the box” options for investing in yourself could include purchasing a new mattress so you get a more restful night’s sleep or using the money to launch a side hustle.
Contribute to Your Retirement
An IRA (Individual Retirement Account) is one of the best places to put a tax refund. Again, this option might seem a little boring right now, but when you’re living it up in Paris when you’re 63, it won’t seem so boring then! Traditional IRA contributions are also tax deductible in most cases, so you’ll be reaping an extra benefit sooner.
Save for a Home
Many loan options today don’t require you to have a large down payment in order to buy a house, but the bigger the down payment you’re able to make, the better position you’re in for the long run. Save as much as you can before purchasing a house so you can avoid private mortgage insurance and have a smaller monthly mortgage payment. Having a larger down payment also gives you a higher amount of equity in your home right off the bat, should you need to use it in the future.
Increase the Property Value of Your Home
Home improvement projects are a great way to “invest” your tax return money. If you have an older home, consider using your tax return to replace old windows and weather stripping to help improve your HVAC efficiency. You could also replace old appliances to help with energy efficiency. For newer homes, consider using your tax returns towards finishing your basement or adding some smart home technology. Remodeling an out-of-date kitchen or bathroom can also help add value to your home.
Make the Most Out of Your Tax Return with Patriot Federal Credit Union
Patriot has lots of options for making the most out of your tax return, whether you are saving it for a rainy day, planning for retirement, or purchasing a home. Call us at 888-777-9982, go to our website, or visit one of our branches today to learn more about our great-rate products for all of your financial needs.