Waste Not, Want Not
Many of us are familiar with the proverb that says, “waste not, want not.” Those who are not familiar with it might be wondering what it means. The premise is that if you use your money and/or resources wisely, then you will never be in need.
According the the IRS the average income tax refund in 2019 was approximately $1,900, Several people got substantial tax refunds this year. Some may have already spent it and are already looking for resources to pay next month’s rent and/or bills. Others have not yet decided what they are going to do with the money.
If you are in the latter group, here are a few suggestions that may help you to “want not.”
- Start or increase your Emergency Savings Fund. You know from experience that something is going to come up unexpectedly. Wouldn’t it feel great to be prepared the next time instead of wondering how you are going to pay for it?
- Decrease your debt. You have been talking about decreasing your debt and/or paying off the small bills and credit cards for a long time. Now, you have a chance make a dent in your debt and possibly accelerate it for larger amounts.
- Invest in a retirement account. You may or may not be participating in an employer sponsored retirement plan, like a 401(k). However, you can still open a traditional IRA or a Roth IRA. Make sure you talk to an investment professional before making any investment decisions.
You may want to use some of your money from your income tax refund for something fun and that’s OK. I just suggest that you use your income tax refund wisely so you are not struggling a few months from now. Or because it is a good opportunity to achieve one or more of your financial goals. Remember, “waste not, want not.” All the best.
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