Money Talks News: How not to blow your tax refund - News, Weather, Sports, Toledo, OH

Money Talks News: How not to blow your tax refund

(Source: Money Talks News) (Source: Money Talks News)

For the people who will receive a tax return, there are a variety things that they can do with their money.

Options weigh from spending the money on shopping, using it for traveling, catching up on bills or simply saving it for a rainy day.

According to the IRS, the average tax refund in 2017 was about $2,800.

Anyone who is expecting a big check this year knows the temptation is going to be great to blow it.

But it's important to consider that this refund check isn't "found money." It's actually your money. Money you overpaid to Uncle Sam. Now it's time to make the best use of it. Here are some ideas:

First, pay down high-interest debt. No debt? Beef up that emergency fund or boost your retirement savings.

Idea number two: Become productive. Take a class or start a business or leverage your refund into more money.

And a final good and smart idea is to make a charitable donation. By doing so, you'll be helping others yourself by creating a deduction for next year's taxes.

If those options aren't exactly what you had in mind, at least try not to spend it frivolously 

An example of that would be to create more debt. Resist the urge to use that refund as a down payment to borrow for a car or other depreciating asset.

Also deciding to loan your money to someone who might not pay it back, might not be the brightest thing to do.

And a final foolish way to use your tax refund: frittering it away to temporarily live beyond your means. Remember, this isn't free money. You worked hard for it.

Here's one more tip: While it's obviously nice to get a check in the mail this time every year, if you overpaid your taxes, you could adjust your W-4, have less withheld from each paycheck, and have more to save throughout the year.

More ideas on what to do with your  tax refund can be found at the Money Talks News website.

© 2018 Money Talks News. All Rights Reserved.

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