3 Smart Ways of Using Your Tax Refund

Finance

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.

Andrew Kollmer

Andrew Kollmer teaches business management. His journey to management began in the 90’s when he had his first degree in computer science. After spending the early part of life as the head of technical support in various teams across the country, he took another step into management. He majored in business management from the University of Pennsylvania. He has a business column on the local newspaper where he shares his opinion on the local economy from time to time. He still contributes to tech forums and support groups, sharing his vast knowledge of computer operations. He is a keen follower of local politics and aspires to run for a political office someday. For now, he is fully committed to teaching.

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