Don't Waste Your Tax Refund!
If you are like many Americans, every year you look forward to receiving a tax refund as your "reward" for filing your tax returns. As of the end of February, the IRS said the average refund being issued was $3,120; no small chunk of change!
It's like we use the tax system as more or less a forced, albeit non-interest bearing, savings account throughout the year. Actually, in my view, it's an interest-free loan to the government, but that's another day, another article.
For quite a few, that refund is a source of sorely needed cash to pay essential bills, coming at a critical time. But from the look of social media postings and listening around, it can be somewhat amusing to see the ways that some folks intend to splurge with that refund!
Now, nothing wrong with the occasional splurge, but at the risk of being labeled a tight-wad (wouldn't be the first time), might I suggest that there are many ways you can simply "waste" your hard-earned tax refunds? Here are a few "tongue-in-cheek" yet very real ways:
1) Register (& actually attend) a Get-Rich Quick Seminar – um, no! That guaranteed, cannot miss, money-making opportunity that seems too good to be true? Probably is. Skip it, and consider investing in yourself through some form of continuing education, which might actually qualify you for a tax credit.
2) A Trip to Tunica (or other gambling hot spot) – Ok, don't take this as a knock on casinos if that's your entertainment thing. BUT, if you are looking to increase your cash through a lucky bet, well maybe you should reconsider. There are better ways to do that, such as a wisely managed retirement plan.
3) Bury It in the Backyard (or Hide It Under Your Mattress) – Yes, people do this. When they don't know what to do with their money, some will just hide it somewhere (a jar in the closet is another option). A better option could be to make an appointment with a financial planner who could help you get and stay on track to a more secure financial future. Some planners charge a small fee that's well worth the investment, while others may do it on a complimentary basis.
4) Make a Down Payment on an Expensive "Toy" – Maybe you've heard the saying (or a version thereof), "Men are just boys with more expensive toys". There's some truth to that! Everyone dreams of having a more expensive vehicle, maybe a boat, that kind of thing. But does using your refund to buy something like that, incurring more debt in the process, make financial sense where you are in your life? Or would paying off other debts you have, maybe a high interest credit card for example, make more sense and help you get more quickly to a place where you could actually afford that toy?
5) Shopping Spree (One for the Ladies) – Ok, I realize I'm wading into disputed territory here, but since I hit the men above, I figured equal time, equal treatment, right? I've been into some of those "designer" handbag stores with my wife for a peek. I've endured the "down-the-nose" looks of the sales people who figure I don't look I could afford a Louis Vuitton. But they're so pretty, am I right, ladies? Before you leap, think long and hard, will that bag (or shoes, clothes…you pick your passion) help you pay for the inevitable crash of a water heater, car repair or medical emergency? Maybe a "rainy day fund" is a wiser choice, if you don't already have one.
Ok, we've had some fun with this, and I could go on, but I think you get the point. By all means, if you've taken care of your other obligations and have your financial house in order, enjoy that refund in whatever way makes sense to you. But think before you splurge. Using your money wisely now with a little delayed gratification might not get you the big rush of some of the things discussed above, but it could lead to a more secure financial future that provides for more and better fun later!
