If you’re anticipating a tax refund this year, you need a plan for your money. Many U.S. taxpayers dread April 15 each year, but if viewed with the right attitude, filing taxes and receiving a tax refund isn’t always a daunting task. Having a specific purpose in mind can prevent your refund from burning a hole in your pocket.

Think of your tax refund as a part of your monthly paycheck. Being responsible with your tax refund should always be a main consideration, so if you have bills to pay or financial obligations to address, consider using your refund toward shaving off debt, paying necessary bills and decreasing the amount of money you owe. If you aren’t strapped down by debt and look forward to your tax refund every year, there are countless creative and smart ways to make the best out of your returned dollars.

Spend on Something You Need
It might not be the most exciting way to spend your tax dollars, but groceries and gas for your car are necessary purchases. Put your tax refund to good use by starting a grocery or fuel allowance. Or maybe you’ve been putting off essential purchases, like new winter boots, a car repair, or a dental work. Using your tax refund to cover crucial costs will ensure it’s been put to good use.

Pay it Forward
Consider donating part (or all!) of your refund to a charity of your choice. Choose a cause that is meaningful to you and beneficial to your community. You can go online to www.uwsjc.org and donate directly to United Way of St. Joseph County, which will ensure your donation will benefit individuals in the community. Apart from helping individuals or benefitting an entire community, you can even claim your donation in your tax deduction.

Make Home Improvements
Have you been waiting to replace your roof, update your washer and dryer, or fix a broken appliance? Consider spending your tax return on home improvements. Swapping out energy-zapping appliances for energy-efficient alternatives could save you money on your monthly utility bill, and a kitchen renovation can increase the value of your property.

Save It
Stashing your tax refund into a savings account, a college fund for your kids, a retirement plan or an emergency fund are all ways to set your money aside until it’s needed for a specific reason. Saving your tax refund can help you reach your financial goal for future events.

Invest in Yourself
If your financial priorities are covered and you have some money left over from your refund, you can use the leftovers to invest in yourself. Focus on your health by joining a gym or taking a yoga class, feed your interests by taking cooking lessons, or spend quality time with your family on a weekend getaway. The options don’t end there – you could take your dog to obedience class, treat your family to a nice dinner, or freshen up your look with a new haircut. Just remember to be responsible with your money and be sure to not overspend!

Regardless of your plans for your tax refund, be sure to think it through before spending and prioritize in order of importance. A tax refund can be very useful if spent (or saved) correctly, so be sure to have a specific purpose for your refund in mind to ensure it goes to the correct place.

Tony Flora, United Way Board of Directors, Labor Chair, North Central Indiana AFL-CIO Council
Judy Fox, United Way Board of Directors, Financial Stability Chair, Notre Dame Law School

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