Hello Lovelies! After all of your feedback on my last TurboTax post, I started thinking, “Should I share more of my business dos and don’t with you?” I spent the better half of my career in Finance and learned some invaluable lessons that I’m certainly applying as I navigate through my entrepreneurship journey. As tax season comes to a close and we begin to think about our tax refund, the question becomes, what will you do it with yours?
Side bar: If you haven’t already filed, I will be gifting my last Turbo Tax Live gift card on Instagram so keep a close watch. This is the perfect opportunity to get those taxes filed and save some cash!
So, with that said I thought I’d first share some statistics on how people spend their tax refund and then provide some tips on some good options that will have you winning in the long run! Girl boss in full gear! According to TurboTax’s statistics, people do the following with their tax refund:
o 30% put it into savings
o 26% pay off their debt
o 15% put it towards living expenses
o 11% buy clothing or do home improvements
o 8% go on vacation
o 10% do other things
So, although I’d love to get that Chanel bag I’ve had my eye on or take Al on a fancy vacation, for me, my tax refund becomes the perfect opportunity to put more money in my pocket. Here are three tips that are perfect in optimizing your finances:
Tip #1: Pay off high interest rate debt. Doing so is guaranteed money in your pocket equal to the interest rate that you would have paid the lender. High interest rate debt is no joke and having it linger over your head can be daunting. Paying this off will not only allow you to put money in your pocket but will also provide better cash flow on an ongoing basis.
Tip #2: Don’t think about it twice and put it into an investment account. With the average S&P 500 annualized rate of return at around 10%, there is no reason to not put those dollars away and get that compounded interest year over year. Sit back and watch your money grow. In case, you are thinking savings account instead, refer to tip #3.
Tip #3: Save it. I know it’s not what you want to hear but who doesn’t need a little extra cushion. Saving it will give you piece of mind and not stressing over money is definitely a huge win in my book! Although savings accounts don’t pay out as much interest as investment accounts (hence tip #2), they are less risky and are perfectly viable options. I have found these tips to be super helpful, but truthfully if you want to splurge a little have at it. Life is short, but at the very least take a portion of your tax refund and do something that will pay off MORE than the cute shoes you (and I) adore! Until next time.
This is a sponsored conversation written by me on behalf of Intuit. The opinions and text are all mine.