Are your Plans Wise?
by MALU BRADFORD BEYONCE
Jan 29, 2014 | 768 views | 0 0 comments | 23 23 recommendations | email to a friend | print

It’s tax time. I love seeing all the commercials about tax preparation. I know that is strange but I do. I love getting my taxes done. I love getting a tax refund also. I am sure most people do. Do you already know what you are going to do with that lovely tax return? I do.

 

If I get a tax return, I immediately put it into savings. I don’t spend it. I don’t have immediate plans for it. I save it. I know way too many people that have unwise plans for their tax return before they even get it.

 

I wonder why people don’t do something wise with their tax return. It seems like the ones who need the money the most are the ones who waste their return. When I was younger I had a friend that always had a plan for her refund. One year she planned on getting a new living room set. The next year she planned on using it toward a new car. I wrote about someone I knew who got a loan against their tax return to buy Christmas presents this past season.

 

I told my young niece she should save her tax return. I told her it was stupid to go out and buy something frivolous with it.

 

“Well not everyone is smart as you auntie,” was her response.

 

I think everyone should be wise with their refund, especially if you don’t have an emergency fund. Remember when the government shut down not too long ago? I saw interview after interview of people saying they didn’t have enough savings. Most experts say you should have at least six months of savings in order to save you from a financial disaster. I agree with the experts. Seriously, it can take years to build up your savings if you are just taking a little bit out of your paycheck each month.

 

My young niece doesn’t even have a savings account but yet she is making plans with her tax return. Not wise.

 

Another wise idea is to pay off your credit cards. If you have a lot of debt, pay it off. Why pay high interest on your credit cards, student loans or car loans? If you just put the money in your savings account but still pay high interest every month you are just borrowing money from your self.

 

There is nothing wrong with spending on something you want but your basics should be covered. What about life insurance? If something should happen to you and you are the provider for your family, would they be taken care of? Depending on how much your return is, you could create a death benefit that is pretty significant.

 

 

I know most people like to have fun with their return. What about the summer vacation you are planning? You could prepay for it. Set aside money from your return for that summer getaway in a separate account and continue to add money to it every month. When you start planning now for the future, you can avoid using credit cards on your trip. In other words, saving money.

 

I’m not saying don’t spend the money on something you want. Just be wise about it. Like most young people, my niece wants to move to the big city. She wants to do it fairly quickly also. My advice to her, get a savings account with at least six months of expenses before you move.

 

I plan on saving my tax return again this year. I have plans for the money down the road. Investing in my home and building a college fund for my children are my plans. What are yours? Whatever they are, you may want to rethink your plans and see if it is the wisest choice you can make.

 

© 2014, MaLu Bradford Beyonce, All Rights Reserved.

You may reach MaLu Bradford Beyonce at malubeyonce@gmail.com.

 

 

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