Tax day is barreling towards us at breakneck speed. It will be April 18th before you know it but getting your taxes filed is just the beginning. The hard part comes after you get that refund check. There are plenty of financial advisors telling you how you should spend that refund but no one is warning you against spending that government money the wrong way.
Here are a few ways that you should definitely NOT use your tax refund:
- Import an exotic animal. You may think a tiger would make the best pet ever. Your friends would certainly be impressed… until someone gets bitten.
- Spend the whole thing on lottery tickets. Sure your odds get better with each ticket you buy. Even if you purchase 100 tickets, your odds will still be 1,000,000 to 1(roughly double the odds of winning an Olympic Gold Medal).
- Buy a brand new luxury car. The price tag on a luxury vehicle frightens a majority of bank accounts. That vehicle immediately loses up to 19% of its value when you drive it off the lot.
- Over the top remodel. You’re sick and tired of the same old fixtures around the house and you need a change. While a remodel isn’t the worst way to spend your excess cash, extravagant fixtures like a golden bath tub or a carbon fiber toilet seat aren’t necessary.
- Cash it and set it on fire. It may provide temporary warmth but that money would probably go much further if used to buy a heater.
If you are one of the lucky few who get money back from the government, spend it wisely. Don’t throw money away on something that you will probably regret before the end of the month. The average tax refund is around $3,000. That money will go a long way to starting an emergency fund or padding a retirement nest egg. If you’re still having trouble deciding how to spend that cash, setup a free appointment with Avadian Financial Services and make your refund work for you.