Like millions of Americans, you’ve gotten some money back from your tax return. So what should you do with the extra cash? While that new pair of shoes may be calling to you, this article steers you toward some smart alternatives to simply splurging.
Millenials and Tax Refunds
According to The Motley Fool website, about half of all Americans will receive a refund in 2017. The luckiest of the bunch are the Millennials, with 66% getting some cash back. Gen X’ers come in second place with 49%, followed by the Baby Boomers with only 39% getting a refund.
How Does Everyone Else Spend Their Tax Refund?
While you might think a windfall from your return is a cause for most people to splurge, today’s economy says different. Bankrate.com, who’s been studying the tax return spending habits of Americans since 2010, says their research shows only 6% of U.S. adults who are getting some money back from the IRS are planning a vacation or shopping spree. Instead, the highest rate of Americans since the study began are planning on spending it on things they need, such as bills or food. Additionally, 34% plan to save or invest it, while 27% will use it to pay off some of their debt.
So How Should I Spend My Refund?
Here’s some unique ideas of what you can do with that tax refund, other than reworking your wardrobe:
- Feed Your Head. Pick up a new hobby, take a class on something you love or even invest in education that could get you that promotion down the line.
- Deal With Those Credit Cards. Start with the high interest ones and work your way down.
- Create an Emergency Fund. Life happens. Be ready for unexpected car repairs, getting laid off from your job or even medical bills.
- Think About the Future. OK, investing in a retirement fund isn’t the sexiest thing you can do with your money, but you’ll appreciate it in the long run.
- Help Out. Give some money to a charity or a cause you love. It increases your feel-good factor.
- Sass Up Your Space. You spend a lot of time in your apartment — why not give it a fresh lick of paint,
new cushions or get that chair you’ve been eyeing?
- Clean Out Your Eating Habits. Throw out that suspect pack of whatever lurking at the back of your cabinet and fill your pantry with the good stuff.
- Take Some Time Off. You know those vacation days you never use, only to lose them at the end of the year? Take them and go somewhere you’ve always wanted to.
SEE ALSO: Apartment Budgeting Tips
Get social with Rent.com and let us know how you’re spending your tax return!