There are many ways to wisely invest your tax return. Your financial planner can help you dig through options including mutual funds, IRAs or even less common options like structured settlements and annuities.

But we’ll leave that job to the certified financial experts. For those looking at some cash in hand and thinking of ways to put it to good use, there are other ways to “invest” that may not be a rigid financially, but still certainly worthwhile.

Invest In Home Equity

There are two ways you can invest that big tax return in your home. The first is to simply send the extra funds to your mortgage company as a way to buy down the principle on the loan. That means you’ll pay less over time on your loan. The other way may be slightly more fun, but can still be an excellent investment – fix up your home.

If you’ve been eyeing that peeling linoleum in the kitchen or sighing over your cracked tile counter tops why not invest in a few home improvement projects? Shop around, of course, and then look for options that make sense for your neighborhood. In fact, your neighbors may be an excellent place for inspiration.

The wisest investments are those that raise the value of your home more than you actually pay to install them. Installing exotic hardwood flooring when all of your neighbors have more cost-effective laminate will likely not return much on your investment, for example. Plan home improvements wisely, however and you can benefit from the new polish and shine of upgrades and boost your home value, too.

Invest in Your Peace of Mind

It’s a well-known fact that most of us don’t have enough savings. You should have a special account with three to six months of living expenses readily available for your use. In addition you should have savings accounts for big ticket items you’re planning for, the kid’s college future and your own retirement. If you’re not totally squared away in these areas just yet, you can get at least a bit further ahead by using your tax return to help increase the amount you have in savings.

If you do have all of your savings accounts up to date and you don’t need to save this money, you don’t have to spend it right away either. Stash it in your savings account until you’re ready to spend it on something you really just can’t live without.

Invest in Your Education

While it’s unlikely your income tax return will be enough to pay for a full round of tuition, it will likely be enough to pay for a bit of summer school or a new certificate in something that interests you. With the economy recovering without a lot of jobs, getting trained in something that is being sought after like specialty medical technologies or HVAC and electrician trades will go a long way to launching a new career path.

If you’re content with your career, you can always use your money to invest in something that expands and enriches your mind. Perhaps you’ve wanted to learn a new language or gain a new skill in your area of business. This year’s tax return may be just the thing to pay for those learning opportunities.

Invest in Your Family

These have been tough years for many families, and quite a few families aren’t quite out of the woods just yet. Many families have put off major expenses like new cars, upgrades at home and even basic family vacations or entertainment options at home. Living in a household with a tight budget can be stressful, and unless you’re very creative it can be a challenge to find fun things to do with your slight amount of spending money.

Your tax return may be just the thing to jump start some new family memories and fun. Often, getting away for just a few days can be enough to refresh yourself, clear away the regular stress and tension from home and bring families closer together. If your family seems to be constantly stressed and tense, consider investing a bit of your tax return in some family fun.

Again, you don’t need to go over the top and take everyone on a 10-day tour through Europe, but if your crew is in need of a break, look into renting a vacation home for a week near the beach or on a lake. This may be more reasonable than you’d expect, and you wouldn’t have to spend much extra on food since you’d have a kitchen on hand. It’s important to remember, however, that spending on family fun should not be put before spending on basic necessities or your peace of mind.

Leave A Reply