Expecting a tax refund in Greensboro? How will you use it?
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If you’re a Greensboro, North Carolina resident expecting a tax refund in coming weeks, have you thought about how you will spend the money? According to the IRS, the anticipated average income tax refund for 2017 is more than $3,100 which is up nearly 1% over last year’s average refund. That’s a nice chunk of change to have in your pocket and, if used wisely, can improve your life and financial future. Here’s how.
#1 Pay Down Revolving Debt
If you’ve got some credit card debt you’re carrying month to month, that means you’re paying interest. Credit cards charge some of the highest interest rates on debt for Greensboro consumers. If you can make a dent in your credit card debt with your tax refund, that’s an effective way to use your windfall. If you have several cards with debt, tackling the one with the highest interest rate first should save you the most money in the long run rather than paying down the largest dollar amount first.
#2 Pay Off Secured Debt
Is your car loan payment a monthly hassle? Depending on the time left on your loan, you could use your tax refund to pay off the debt and get that monthly bill out of your life. Paying off a car loan also means you can switch to more affordable, non-comprehensive, car insurance. If your tax refund isn’t enough to pay off the debt entirely, making a special payment towards the principal balance should impact your payments but be sure to check the fine print on your loan to see the terms and conditions.
#3 Take on New Debt Wisely
If your Greensboro commute has worn out your vehicle and you need a replacement, putting the money towards a good quality used car can help you get a late model vehicle without taking on the full burden of 100% financing. And remember, buying a new car often means you’ll be upside down on the note. Upside down is when you have negative equity (i.e. you owe more than the vehicle is worth). But if you look for a good deal on a reliable used car, you should be able to get more bang for your buck.
#4 Set Up an Emergency Fund
Did you know almost 30% of Greensboro residents and other Americans have no emergency savings? Putting your tax refund into a savings account and leaving it there for a rainy day is wise if you have no other safety net. This fund can help if you have a major repair or other unexpected expense. Even a minor expense out of the blue can wreck your finances if you’re not prepared. A couple of thousand dollars would be a good start on a fund with the goal of having enough to cover a few months of expenses.
#5 Invest in Your Retirement
Many Greensboro consumers haven’t started their retirement fund or don’t have near enough in the account. You can put your tax refund into an IRA if you already have your emergency fund set up and let the money go to work growing into a nice nest egg. If you put every income tax refund check towards your retirement, that can help build a buffer you would not otherwise have. That’s a better investment than blowing the money on something that won’t last nearly as long.
#6 Invest in Yourself
Is there training or a certification that can boost your earnings at your Greensboro job? Why not invest in yourself and devote your tax refund towards additional education, training or another program that can earn you more money in the long run? Advanced training and certification is something that can make the difference when you apply for a promotion, a new job, or other career advancements. And if your company matches training funds, you can double the bang you get for your buck by investing in yourself.
#7 File Bankruptcy
One comment we hear among clients considering bankruptcy is that they thought they couldn’t afford to file bankruptcy. Some North Carolina bankruptcy attorneys offer zero down bankruptcy or offer installment payments to help Greensboro consumers. If you have a pile of medical bills you can’t pay, your credit cards are maxed out, and you’re not sure how to dig yourself out, bankruptcy might be the best answer and using your tax refund to cover the expense can get you out of debt fast.
To find out more about the benefits of Greensboro bankruptcy, contact the Law Offices of John T. Orcutt today. Call +1-919-646-2654 now for a free Greensboro bankruptcy consultation at one of our convenient locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington.