10 smart uses for your tax refund

A refund check is a great way to seed your 2013 financial goals. Here are the 10 of the smartest options.

 of 12
 of 12


Oct 7, 2013 11:35AM
Here's a good idea.......pay bills instead of buying crap you do not need!
Jun 19, 2013 10:09PM
Addition to the item suggesting contribute to your retirement...So you are not so sure about making contributions because your income is  modest?  Consider this - your contribution today will not only be (most likely) a reduction in your adjusted gross income, for those that qualify, that contribution CAN ALSO ELIMINATE your tax.  Form 8880 is such a gift for those who really need the boost and incentive to save.  Singles 18 and over who earn 22,250 and can manage to place 5,000 into a tax deductible IRA (now keep in mind, your $3,000 refund head start, means you would be scraping together $2,000 (about 167 a month) for the remainder) will get a credit for 753 dollars (their full tax balance) and ALL of your withholding plus refundable credits will again come back to you next year.  The income threshold used here increases each year - these are 2012 (the return you filed this spring).            Married?  You'd be able to have wages from either or both that total 44,500; contribute 10,000, or 5,000 for each spouse (quite a bit more to scrape together though at 584 a month) and your Form 8880 credit TOTALLY eliminates $1,503 in tax - thereby enabling your withholding to be returned to you next year.  Repeat, repeat, repeat and some day, you'll treasure your retirement nest egg. Of course I am highlighting the best 50% scenario, Form 8880 is still a great deal when the percentage is phased lower as income rises. Please, please have an emergency fund established before you do this...it will help ensure you NEVER EVER tap into your retirement savings.  That is for your senior self - you are probably worth the effort and you'll thank yourself 30 years from now. BTW this also works for 401k and, absent the reduction in AGI thus slightly lower earnings, Roth IRAs.
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.