How should you spend your tax refund? Figuring out the answer is a nice problem to have and one that’s worth consideration. One of the best ways you can use an unexpected windfall like a tax refund is to pay down high-interest debt, such as credit card balances, because it will immediately lower your interest costs. If this is not an issue, you may wish to consider setting aside as much as possible in savings, whether that means a tax-advantaged retirement plan, college funding account or vacation nest egg. Use the balance to splurge, rewarding yourself for making some smart financial decisions.
If you received a very large refund this year, you may want to consider adjusting your withholding or estimated payment amounts so that you can keep more money in your pocket during the year. We can provide guidance on all your tax questions, so think of calling our office first when making important financial decisions.