Updated: Feb 8
It’s tax season and yeeeeeowwwww! The thought of a nice, fat tax refund is probably already burning a hole in your pocket. Everyone has different ideas of what to do with their refund - a trip to Antigua, new big screen TV, or maybe a down payment on a shiny new car.
Not to be your very own Debbie Downer, wahhhh wahhhhhh, but before you go and blow your refund on something completely frivolous, I want you to stop and think about the fact that this isn’t really found money. This is YOUR hard-earned money from your blood, sweat, and tears. If you’re keeping your eye on the prize, this is a great time to invest this money back into yourself and your future.
Here are three ways to compound that money into a better future you:
Invest in your dreams! Do you have a goal that you just haven’t had the capital to back up? Your tax refund might be just what you need to kickstart your ability to turn your side hustle or business idea from a dream to a reality. Think about what it will take to get started and consider using this opportunity to make it happen. There’s no better place to invest your money than in YOU. The more you can pleasure delay on short term material dopamine hits vs using that money for long term happiness meter fillers, the closer you’ll get to firing on all cylinders. When you succeed, you won’t need a tax refund to take a vacation or buy a car. You’ll have the income to support the life that you want.
Invest in your home. Your home is your haven. Having pride in it and being comfortable is an asset to your emotional health. It’s also an investment that can be valuable as you plan your retirement. Protect this investment with smart repairs and improvement projects. According to Realtor.com, a garage door replacement can recoup 98.3% of its cost at the time of sale. Other worthwhile improvements include manufactured stone veneer (97.1%), a new wood deck (82.8%) or a minor kitchen remodel (81.1%). If you choose a project that can make you happy now and recoup your costs while making your home more attractive for buyers later, these renovations can help keep both your emotional and financial health in check.
Invest in passive income. Grow your money by investing in the stock or real estate market. There’s no reason to pay financial advisor fees unless you get into serious money, which I can help guide you on as well. Not sure what stocks to invest in, follow the most successful investor of our time’s advice, Warren Buffet, who says stick to index funds and ETFs. This takes the guess work out, and they tend to outperform even the best of the best stock pickers. Even a monkey throwing darts at a list of stocks! You can get started investing today with setting up a simple account in apps like Robinhood or iBillionaire and directly link your bank account to make regular deposits from your checking account. Autopilot!
While it may be tempting to make a more spontaneous decision with your refund, part of having a growth-owner mindset is having that laser focus to attain your financial goals to keep a healthy career and financial core. Use the opportunity now to grow your finances to support the life you’ve always dreamed of. It’s a success habit that truly is the gift that keeps on giving! Even better than jelly of the month club :)