10 Smart Tips on How to Spend your Tax Refund

This year, I decided to use this platform to do things differently and share knowledge on a few topics that could enhance our daily lifestyles. After a really bad financial decision I made and learnt from few years ago, I took up learning more on becoming financially savvy and building a better and  secure financial future for myself. I developed a habit of researching online articles and reading books to increase my knowledge on the things I knew very little about because lets be honest, No one teaches you proper financial planning in high school or college *Shrug* Life does!

One quote I love from a book I recently read;  ” As a woman today, you’ve got to stop watching and start participating. Even more important, you’ve got to start calling shots for yourself.” – Hope this speaks to someone reading this as it did to me.

Down to the nitty gritty; it’s Tax refund season- YES! so for many, a nice check or transfer will be hitting your accounts and the excitement for unplanned money kicks in. Let’s encourage ourselves to make better decisions off our refund; with that, I thought to share a few ideas to help.

Now let’s get to it!

  • Pay off High interest debt or student loan: ever heard the saying, ” it’s not how much you make, it’s how much you keep” ? We tend to spend more than we really have or that we can afford. Each second an American offers their personal information in exchange for a credit card account offering $50 or 20% off their first purchase. Don’t fall a victim! Racking up credit card debts with interest rates as high as 20% or more doesn’t sound like fun. Work on using the refund to pay off your credit card debts or student loans. Start off with the highest balance or highest interest till you finally hit the lowest, cut off the cards you don’t need. To maintain a great credit score, try to keep your utilization rate under 30%.
  • Invest in a new craft: Find something you’re passionate about and how you can enhance your skills or learn a total new craft. Thanks to websites like Udemy and masterclass.com you can learn more about a new skill for a lot less. Then eventually, you can turn your passion to a paycheck. A cooking, beauty, event planning or photography class can lead you to your next side hustle.
  • Start a New Business: This is probably an idea most people have in mind but always scared to execute because of fear. The only thing stopping you from your goal is the excuse you always make and you’ll never truly know what’s in store until you really try. The best way to go about it is, to find something you’re most passionate about and research the many way you can monetize off of it as mentioned previously.
  • Invest in business ventures or stocks: If you don’t have the mighty courage to just start a new business. Try investing in another persons dream or venture that may yield you possibly seamless 5 – 50% stake or invest in stock market and get some shares. Like everything, there’s always a 50/50 risk but such is life. Go for it!
  • Save up for an emergency Fund: Imagine if you lost your current job; would you cope for 3  months with little or no income? Ever heard of the “Bag-Lady Syndrome” – women who are materially well off but still find themselves living in daily fear of going broke. Let’s slash being the chic with $0 in a $5000 purse and slowly create an emergency fund towards a rainy day. Try researching money market accounts or high interest savings accounts which are great ways to start saving and managing funds.
  • Increase your 401K contributions: No matter what you do always think long term, what are your plans the next 5, 10, 50 years? Where do you see yourself financially. Retirement is one thing most American don’t start planning on time. Unless if you miraculously win the lottery or have a secret trust fund account chilling for you, Don’t wait till last minute to start saving up for the future, contribute a higher 401k amount and if you’re in a really good company, the amount you invest will be matched.
  • Save up for the House: Pretty self explanatory but we know saving up for that dream house can be nerve racking and some what challenging, Try using the money to go towards saving up for the down payment, the higher your down payment, the lower your monthly payments.
  • Give a charitable contribution: Givers never lack- ever heard that saying? to possibly secure a higher tax refund in the next cycle, consider giving a charitable contribution which would in turn increase your deductions and lower any taxes owed.
  • Pay your Tithe: This is a personal goal of mine I planned to attain this year. I know this is more religion based so it may not apply to just anybody but I believe in giving as much offering to the church as you can and letting the ultimate power replenish the gifts much more than you can imagine. If you can’t do that, find the less privileged and see how you can help them one way or the other.
  • Travel & Relax: Lastly, Imagine chilling on a beach sipping your fave frozen cocktail! It’s never a bad thing to travel; Like they say, “Body no be firewood” sometimes all you need is to relax, refresh your mind and reset. A road trip or destination trip could be the perfect investment to awaken your creative juices. Take your time to plan out a great escape and utilize it to the best you can.


If you have any other helpful tips you’d also like to share, please feel free to add in the comments.


Thank you and have a very wonderful week!

Love Agatha!


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