4 Lucrative Ways to Spend Your Tax Refund
Delerme CPA
An Atlanta CPA firm specializing in Real Estate, Entertainment, Expat, and International Accounting & Tax Services.
The Average Tax Refund is up 8% from this time Last Year. With Inflation, Gas Prices, and Other Necessities Rising, it Would be Wise For You to Invest Your Tax Refund Towards Things That Combat These Rising Prices
Today I want to give you guys Four Ways you can invest your Tax Refund so that you can combat Inflation rising. Lets Get Started!
Store Your Refund In An Emergency Fund
I know. I know. It seems like a no-brainer to save your Tax Refund for a rainy day. However, to save takes practice and discipline, especially when you are just starting to save
It can feel daunting, but your Tax Return can help you start or it can help you reach your Emergency Fund goal?
Typically, you want to aim for roughly 6 months worth of living expenses to be your fund goal, possibly more if you were the sole provider for your family. That way you are able to handle anything Life throws at you if need be.
Think about how it could have helped in the past, had you taken the time and discipline to save up for an emergency.
Pay Off Any Debt (Especially Credit Card)
In order to suppress the affects of this rising inflation, the Federal Reserve is expected to raise short term interest rates multiple times this year. This includes Credit Cards...
According to creditcards.com, The average credit card interest rate is at 16.36% as of April 20, 2022If you have any credit card debt, now would be a great time to take care of that. You can use your tax return to help you ‘cushion’ the impact of these raised interest rates.
Debt is not a fun topic to get into, but the longer you wait, the more severe your financial burden becomes. Let your Tax Return relieve some of the stress of your debts.
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Save For Retirement
If you do not have a retirement account in place at the moment you should really consider opening one up. Once again guys, Inflation is happening and we need to be planning for the future. One day we are going to wake up and realize that we aren't going to be able to do the same work we were once able to do.
Think about adding your tax refund into a retirement account such as a traditional IRA or a Roth IRA, that way you will have more money in that account when you retire. The sooner you start, the more money there will be when it’s time for you to take it out.
In 2022, you are allowed to contribute up to $6000 into your IRA. I advise you take advantage of this opportunity as soon as you can.
Upgrade Your Home Office
This is a perfect way to invest your refund. As you work from home, you might notice that you need to replace or upgrade some things you have in your home office.
Get that old chair that you’ve been using all these years, replaced with one that’s more comfortable on your body as you work. Or look into a standing desk if you feel like chairs are attributing to any discomfort you’ve experienced while working from your Home Office.
Either way, the point is to upgrade and enhance your Home Office for the benefit of running the business while also (here's the best part...) providing some Tax Incentives. When you file your taxes next year, you will be able to deduct your office expenses on Schedule C form 1040.?These Write-offs cover:?
Need Direct Help With This?
Are you curious about your Tax Returns and need assistance or you need other Tax/Financial Related Assistance, want to Save More Money each Quarterly, or you need help Creating a Financial Plan then give my office a call at 678-585-6580 or shoot us an email at [email protected] so that we can book a time to meet and see what we can do to help.?You can also Direct Message Our LinkedIn Page. Thank You For Reading