The tax filing season is drawing to a close, and with it comes thousands of dollars of tax returns. Whether your getting a hefty return or just lining your pockets, here are a few tips that could help make those returns last a little longer. Jimmy Goodrum, district manager for State (NC) Employees Credit Union, said recipients need to understand that the check is income and not a gift from the government. “It may be delayed income, but it is still income, and they should do things with it that they would normally do,” Goodrum said.
DO –Pay off a high-rate debt –Open up an Individual Retirement Account “We are going to be responsible more and more for our retirement income and the sooner we start, the more options we will have when retirement is here,” Goodrum said.
DO –Start putting money away for your child’s (or grandchild’s) education.
DO –Start an emergency saving account. “There are a lot of folks out there who just don’t have an emergency savings account,” Goodrum said. “When an emergency comes up, there are two problems. There’s not just the emergency, but now there is the problem of deciding how you’re going to pay for the emergency. If there is money in an emergency savings account, at least you don’t have to worry about how you’re going to come up with the funds to take care of that.”
DON’T –Let the money go to a checking account without a purpose. “The money will just disappear,” Goodrum said. “Things will just come in and gobble the money up if there is no purpose for the money. Go ahead and have a plan for the money.”
DON’T –Make a spontaneous purchase without thinking it through. Goodrum suggested that recipients who may find themselves doing more of the don’t tips can limit the temptation by not getting a refund. “Folks can talk with their human resources department and change their allowances so that their money goes into their regular income 12 months out of the year,” Goodrum said.
