Many Americans filled their returns by April 15th. Some of them have already begun receiving their tax refunds from the IRS and the states they live in.
If you are among the Americans who are expecting a refund do not stock the refund in your checking account otherwise, you will not be able to account for it.
Instead, you should come up with a good plan on how to put the money into good use.
Below are smart ways in which you can use a tax refund better this year.
1. Save The Refund in an Emergency Fund
An emergency fund is a saving account which has three to nine months of daily expenses. Having such a fund is important as it can help you in case you get medical expenses or you unexpectedly lose your job. If you do not have an emergency fund, ensure that you open one to save your tax refund in.
2. Save The Refund in Your Kids 529 Plan
If you have kids, who are almost joining college invest your refund in their 529 plan. You can save and accrue a lot of cash from this plan. Money in a 529 plan grows, and the withdrawals made to pay for education expenses are not taxed either.
3. Buy a Life Insurance Plan
If you have any family member who is dependent on your income, you better be having a life insurance plan. If you currently do not a life insurance policy, then you should put your refund in one.