There are many things on which to spend a tax return and most people have no trouble coming up with ideas for it.
However, it’s rarely wise to run out and spend that money immediately. That windfall needn’t be an opportunity to splurge.
Instead, why not turn it into a buffer between you and the world?
There are many fiscally responsible ways to use that tax return. Money isn’t easy to come by, so here are a few ways to use the extra cash to help you through the tough times to come.
Put it in your savings account
Put your tax return into a savings account and leave it there. Many experts recommend having a cash reservoir to tap into when you’re in trouble.
The specifics vary, but most agree that a thousand dollars should be your minimum for this emergency fund.
Putting your tax return into an emergency fund is the financial equivalent of buckling your seat-belt.
If you want to use it now, consider investing it.
Remember, investing doesn’t just mean buying stocks. It can also mean investing in yourself by taking classes at the local college.
It can mean buying that new piece of equipment that will take your side-business to the next level.
It can mean repairing your house, your car, or otherwise improving your property. Investing that tax return in something that will create yet another return is just good business savvy.
Spend it on your family or your friends
Yes, that money is yours, but you never expected to see it again. Why not share your good fortune with others?
Even loaning it to someone who is hard up, free of interest, is a good use of that money.
Friendship and good will are always more valuable than any amount of cash.
Invest in precious metals.
Investing extra money in silver or gold is a good way to ensure that your money will keep its value. Buy when the costs are low and don’t sell it until you have to.
Precious metal prices have risen drastically in the last thirty years and all those investors who bought when silver was a few dollars an ounce have had the last laugh.
Even if you’re not planning three decades ahead, investments like this can help keep your money from losing its value to inflation.