Tax refund time is a great time to really dig down and look at your finances, but a lot of people don’t do it. We’re not casting blame here, really. In fact, it can be hard to be the voice of financial responsibility when just about every company in business today will be running some type of tax sale that you need to check out. This is when all of the big items go on sale as well. It’s hard to really pass up a cheap flatscreen or the latest and greatest washer and dryer when you know that you have the money. You know that. But if you’re struggling to make ends meet, it can feel like you’re always torn between what you should do and what you know that you must do.
Let’s ease your mind for a minute: there’s no reason that you can’t do both. You might not be able to get every last thing that you want, but you can still go out of your way to really make sure that you can get some things that you wouldn’t normally buy. Even if it’s just one really over the top nice meal at home, that can be rewarding. Remember that it really is your money, to a bonus — this is just money that you gave the IRS for a year and they have to pay it back to you. It’s an overpayment, nothing more than that. There’s no need to feel lucky.
Having a plan before the refund hits can make it harder to blow your refund on frivolous purchases. Think about everything that you want, and then see if you really want it. Yeah, it’s cool to an advertisement for a really good sale, but what about if you could just jumpstart paying off some of those high interest credit cards? That would really be the best feeling of the world to really step back and be able to pay for the real things that matter. It’s tempting to just skip over all of this and plunge into something else, but you don’t want to do that. You don’t want to just seek pleasure when you’re in debt, because debt has a way of growing very, very quickly.
All things considered, now is definitely the right time to start thinking about getting out of debt. We always tell people not to just throw everything into the debt pool because they’re going to feel unsatisfied. And when you feel unsatisfied, you have a tendency to want to spend even more money. So sometimes the best thing that you can do is give in to some of your wants.
When it comes to the needs side, we think that thinking about setting up an emergency fund is a really, really good thing. Now is not the time to think that you can just sit back and wait for an emergency to happen — even if nothing has happened yet, you never know. The future is very uncertain, and it can often take a little emergency to really derail your finances.
The best thing that you can do right here, right now, is to make sure that you focus on the goals that you have for your life. Remember — nobody is going to want your dreams more than you, so keep that in mind and fight well! Good luck out there!