The American Bankers Association estimates a family carries approximately $10,000 in credit card debt. If you are carrying high interest debt, there is no better move than to pay off your credit cards first! This would in turn immediately save you money and generate instant returns for you. Say for instance, if you have a credit card balance of $3,000 and incurring high finance charges, paying down this debt would actually save you a lot of money over time versus simply paying the minimum monthly payment.
Increase your net worth
Getting extra money is great, but increasing your net worth is better! Your net worth is simply your assets minus your liabilities, which will provide you with your current net worth. Be strategic in what you do with the money you received. Use the money to not only pay down debt, but build an emergency fund, save for retirement or put away money for your children’s college tuition. If you struggle with reaching your goals on your own, consider meeting with a financial professional to hatch out your financial goals. But do your homework first! Take time to research to make sure he or she is a great fit for you. Also, question your planner about fees, specialized services and his/her credentials before committing to services.
Whichever fits your needs, strategizing how you will use your tax refund this tax season will only help you reach your financial plans sooner!
Remember: your choice, your future!