5 Ways To Spend Your Tax Return

Well it’s that time of year again, but before your tax return hits your bank account and begins burning a hole in your pocket, it may be worthwhile considering a few good ways you could spend the money rather than buying that impulse item which has caught your eye.

1. Pay Off Credit Card Debt
One good way to put your refund to work is to pay off credit card debt you may have accrued throughout the year. Credit cards attract high rates of interest that is often not tax deductible; therefore it may be an opportune time to eliminate this “bad debt”.

2. Build A Rainy Day Fund
Accidents do happen, and when they do unfortunately life doesn’t stop, there are still mortgage repayments to make and school fees to pay. Therefore it may be a good idea to have some money put away to help cover these expenses. It is commonly said you should have three months wages in a high interest account to help meet your obligations should something happen.

3. Do A Course
One of the best ways to improve your earning power is to improve your skillset. Using your tax refund to invest in your professional development may be just the thing you need to get that promotion or pay rise you have been chasing.

4. Do Those Renovations You Have Been Putting Off
Why not use your tax refund to improve the value of your family home. By doing those odd jobs around the house you have been thinking of but never got around to, you may be able to do just that. And given that there are often no tax consequences when selling your family home, then this option may be worth some consideration.

5. Top Up Your Superannuation
Yes, your employer pays your super, but that doesn't mean you shouldn't contribute to the happiness of your future. Although it’s not something that feels urgent, you should really make a point of topping it up at tax time each year.

- By Benjamin Demery