It’s always exciting to get money back when you file your taxes. While the idea of using the windfall to buy this year’s high-tech gadget or something else you urgently want is always fun in theory, there are savvier ways to invest the cash and make it work for you in the long run. Here are five smart ideas on how to invest your 2020 tax refund.
Wipe The Slate Clean
It may not have been your first impulse, but using your tax return check to pay off is an intelligent move. Student loans? Kick them to the curb! Credit card balances? Good-bye! By paying down any loans or debts, you could also give your credit score a healthy boost which will always help you down the road.
Invest In Your Future
Speaking of your future, investing your tax return in your retirement account is a smart idea. Whether it’s a 401(k), IRA, or another retirement account, is always a solid step in the right direction. You could also use your tax return to bolster your emergency fund, if you don’t already have 3-6 months’ worth of expenses stashed away for a rainy day.
Invest In Yourself
Of course, the case can always be made for investing in yourself and your career. By that, we mean taking training classes, obtaining an important certificate, or any other kind of continuing education that will improve your skill set and enhance your career prospects. You could even use your refund to pay for a professional resume writer if you’re looking for a new opportunity!
Add To Your Kid’s College Fund
If you have children, a looming college bill can often be a big stressor. Investing a few extra thousand dollars in your child’s 529 College Savings Plan would certainly be a good use of the cash.
Tend To Your Home
There are several smart ways to invest your tax refund into your home. If you own your house or condo, you could apply the money to paying down the mortgage principle, which would help reduce your home debt down the line. You could also use the money toward making necessary repairs or investing in its value, such as upgrading your landscaping, which can quickly boost the property’s value.
Call a Member Specialist today at 800-422-5852 to find out how we can help you invest in your future.