It is estimated that an average Australian gets about two thousand six hundred dollars worth of tax refund per year. That’s a lot of dough! However, that money can go fast especially if you hadn’t planned on having it. You can recklessly spend it without thinking of doing wiser things with it. Before you go off to spend that money on something you actually don’t need, here are some ways you can make better use of your tax refund money.
Use it as payment for debt – If you’re in the hole, paying off some or all of that debt with your tax refund can get a huge weight off your shoulders. The less debt you have, the less interest accumulated and the faster you can pay off your debt as well. If you still want to reward yourself a little and still pay off some debt, you can spend some of your refund for something frivolous and the bulk of the refund can go to paying off your debts. Paying off your debts should be your focus with any money you get if you have a lot of debt from things like student loans.
Put the money in a savings account – If you have no outstanding debts, the extra money you have from your tax refund can go to a savings account. If you have a savings account that gives you a decent interest on your savings, the money untouched can grow over time. When you want to use it later down the road or when you want to use it for emergencies, it’s conveniently there and you won’t have to take out a loan for emergencies.
Give it to your children’s college fund – Every little bit helps when saving for your children’s education fund. University or college tuition is really expensive. Having money in a savings plan for their college or university tuition would be a wise use of these funds.
Put it towards your retirement fund – You can add this money to your retirement fund payments so you can enjoy it fully when you’re retired and loving life.
Spend it on yourself – If you already have enough going to your retirement fund, children’s college tuition, and you’re not in debt, spend the money any way you like. It could be new clothes or it could go towards fixing something in your house that you didn’t have money to do before.
If you feel you’re getting too much money back, this means you might be paying a lot of taxes out of your income every time you get paid. For some people, this is great as it means they’ll be getting a good return later on. For some, they might need that money that’s coming out of their wages right away. If you’re part of the latter group, you can adjust the tax that’s coming out of your income if you feel they’re taking out too much.
To get your tax filing done in the best manner and get the total refunds you’re entitled to, go to https://www.taxwiseaccounting.com.au/. Don’t wait till the middle of tax season to consult with an tax filing accountant. Do it before the big rush and you’ll be able to get your returns in no time.