How To Spend Your Tax Rebate Wisely
Getting your tax rebate can be an extremely difficult thing
, especially if you made the mistake of choosing to do it yourself instead of going through the tax agency. Normally, once the money comes, one is usually too tired to even think properly on how to spend this money; believe me, spending becomes the problem. What then usually happens is that the money is usually spent on things that are of no great value and the person even ends up not knowing how exactly the money was spent.
In this article, I would like to go into a rather unique topic telling you how you should spend your tax rebate once you have received it.
Pay Your Debts
There is a proverb which says that borrowing money is like attending a wedding while paying the debt is like attending a funeral. Since the money that you would have received may not have been exactly planned for, it is advisable that you use this amount to pay your debt so that you can continue to live debt free. Even if the amount may not suffice to cover all your debts, it will go a along way to helping you move to the next level.
Balance Your Budget
If it happens that you do not have any outstanding debts, then the next thing that you should do with the money is to use it to meet your budgeted expenses. Take note of the fact that the money should be spent on budgeted purchases and not on impulse buying. This way, you will get to spend your money in a way that will not cause you to regret in any way. If you prepared your budget by starting with the expenses before finishing up with the income, you most likely have a lot of things that you wanted to purchase but could not because of lack of finances.
Save the Cash
Saving the cash is also another way of spending the money if at all you do not have any outstanding debts or if your expenses have already been met. Put this money in a savings account so that you will be able to use it in future. The good thing with saving the money is that you can be sure that you won't have to worry about buying the product that will have the greatest utility.
Invest the Money
If you feel that your savings account has got enough float to carter for your emergency needs, the next step you should take it to is invest the cash. Unlike all the other forms of spending the money, this one will require you to make an active decision on what investment is best for you. If you are not sure what to invest in, then you can invest in government bonds which, although do not have high returns, carry very little risk.
At the end of the day, the way that you will spend the money will ultimately depend on your unique circumstances. It is however my hope that the information provided in this article will help you a great deal in making the right decision.
How To Spend Your Tax Rebate Wisely
By: David Desouza
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