April 2, 2012
Smart Uses for Your Tax Refund
Are you giving Uncle Sam a free loan? Find out how you could be putting that money to work for yourself instead.
If you get a big income tax refund every year, it means you're giving Uncle Sam an interest-free loan. Adjust how much is withheld from your paycheck by filling out a new W-4 form. If you get a big one-time tax refund, don't just spend the money blindly – put it to good use. For example:
- Increase payments on outstanding loans or credit cards. You'll reduce the payoff time and lower the amount of interest paid.
- Start an emergency fund to protect your family against a layoff or other crisis.
- Beef up your IRA or 401(k) contributions. The longer the money's invested, the faster your retirement account will grow.
Bottom line: Put your tax refund to work for you – you deserve it.
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