Smart Ways to Use Your Tax Refund

What will you do with your income tax refundIf you are expecting a large tax refund this year, what will you do with it?

It might be tempting to spend this large windfall on shopping, eating out and other fun things.

However, a tax refund is also an opportunity to gain some financial headway and set you up in a better situation for the future.

Here are a few smart ways to use your tax refund this year:

Create an Emergency Fund

If you are currently living from paycheck to paycheck, you are treading water on the surface of your finances and any unexpected disaster can pull you under and cause you to start drowning in debt.

If your car breaks down, you lose your job, or you get ill or injured, you will need to borrow money to get your head above water again and this can take you on a downward spiral which is hard to get out of.

It is essential to have an emergency fund of at least six to eight months of savings to protect you for the unexpected situations which might arise in life.

Use your tax refund to get this savings account started and then slowly build it up more by adding a percentage from every paycheck.

Pay Off Your Credit Cards

Another very smart thing to do with your tax refund is to pay off any high interest debt which you have accumulated.

Credit card debt is draining your finances every month with high interest payments, so it should be the first debt that you pay off.

If you think about it, paying off a credit card charging interest at 18% or more is the same as buying a high-flying investment that gains at least 18% on the same amount of money.

The difference is that by paying down expensive debt, you actually are guaranteeing yourself that return on investment.

You can also contribute it towards paying down student loans, car loans and any other debt you might have.

Make Home Improvements

If you already have an emergency fund and you have paid off your credit cards, spending your tax refund on home improvements can also be a smart way to invest the money.

Renovations can help to increase the value of your property when you eventually resell it, especially when you upgrade the most important rooms such as the kitchen and the bathroom.

Also, green renovations such as adding sealed windows or energy-efficient appliances can save you money in the long run on your utility bills.

These are just a few clever ways that you can use your tax return to set yourself up for the future.

Do you have any other good ideas that you’d like to share?


Finding Time to Accomplish Your Goals

Time to Accomplish Your GoalsHave you ever thought that you would love to write a novel, learn to speak French, or perfect your drawing technique? Do you have other unfinished goals that you are thinking of right now?  

It is interesting how we all have passions and desires that we would like to accomplish in our lives; a legacy that we would like to leave that impacts others in a positive way.

If you are like a lot of people, every time you think about these goals you tell yourself that you just don’t have the time to accomplish them at this stage in your life.

Guess what? If you don’t make time to focus on these dreams, they will never happen.

There will never come a time when all of your other responsibilities disappear and you have endless free time to pursue your hobbies.

Work, family, friends, and other responsibilities will always get in the way, so instead you need to make the decision to make time for these goals.

Here are a few ways that you can carve out the time from your busy schedule to accomplish these goals:

  • Set your alarm 15 minutes earlier. Rather than pushing the snooze button, you could start your day by practicing the guitar or writing a page of your novel every morning. The bonus is that doing something you love first thing in the morning will energize you for the rest of the day.
  • Along the same vein, go to bed 15-20 minutes later than you usually would and spend the last bit of your day working towards your goal.
  • Stop watching television. Did you know that the average American watches four hours of television per day? Usually we use the TV as a way to tune out after a busy day at work, but imagine how much more revitalized and inspired you would feel after spending a few hours working on your passion rather than watching countless reruns of ‘Friends’ and ‘How I Met Your Mother’.
  • If your passion is portable, take it with you wherever you go and work on it when you are stuck in traffic, on a long bus ride, in a waiting room, or other times in the day when you are bored. For example, if you are working on a novel you can take a notebook with you and jot down ideas throughout the day.

These are just a few easy ways that you can find time in your busy schedule to focus on your own goals and work towards achieving your dreams. 

Fear of Failure? Tips for Keeping Your New Years Resolutions

Have you made yourself a New Year’s resolution?Goal Setting

The turning over of the calendar usually inspires us to resolve to make positive changes in our lives, but more often than not we fail to follow through on our promises to ourselves.

If you struggle to keep your New Year’s resolutions, perhaps these tips will help you stay on track:

Be more realistic.

If you set goals for yourself that are completely unattainable, you will become discouraged and give up quickly.  For example, if you want to start losing weight and gaining muscle, don’t expect to look like a body builder two weeks into the New Year. 

Make a goal to visit the gym every second day instead, and if you stick to this reasonable goal you will eventually start to see results.

Make a plan. 

If your New Year’s resolution is to pay off your credit card debt, you won’t get far if you keep on spending in the same way. You need to make a plan to do things differently to get different results.

Your plan could include creating a budget to see where you can save money, and then paying off a set amount per month until the debt is gone.

Talk about it.

If you keep your resolution a secret, there is no one to keep you to your word if you decide to give up. If you tell your friends about your goals they can encourage you and motivate you.

Break the goal into small manageable chunks.

Losing 30 pounds seems overwhelming, but losing five pounds is not so daunting.

However, if you focus on these small goals and lose five pounds six times throughout the year, you will be down to your goal weight of 30 pounds less!

These are just a few tips to help you achieve your New Year’s resolutions.

Experts say that it takes approximately three weeks for a new habit to form. If you can stick to your resolution for this long, your positive habits will soon become second nature.