Finally! Tax Refund is in Hand!! 5 Actions to Choose From


Who doesn’t love it!? I mean that’s why we work, right? The things that are fun, like lake houses, jet skis and drinking beer, all cost… money.

I remember (when I was a kid) on my birthday or Hanukkah when I got a card I didn’t even read the front page. I opened the thing right away to see the amount on the check (or how much cash there was).

Kids are Hallmark’s worst nightmare. All of those copywriters spending hours thinking of clever cards to just be zipped by without any appreciation.

As I grow up, I find tax day (or season) to be similar to those days when I was kid. But the new Hallmark is now my accountant. And the card is either an email or a phone call.

After I file my taxes, I wait a couple of weeks to hear back from my CPA on how I fared for the year. If he tells me I owe money, well, the response from me isn’t too kind and usually ends up with the phone being slammed back to the handset. If he tells me I’m getting money back, well, then it’s time to party! It is like I have known my CPA for years. I am ready to have drinks with him and invite him to my wedding. I am on Cloud 9!

In the back of my mind, I am thinking of how I want to spend this newfound money. Maybe, it’s on that 70-inch TV I have wanted for my living room. Or, possibly that putter that is built to fix my awful putting game. The options are endless!!

Well, this year I didn’t get to have those thoughts, my CPA was more in the camp of being hated for a couple of hours. But for those that got the good news of getting a refund this April, here are five actions to take as you enjoy your newly-found money!

5 Actions I wish I could choose from

Be Proactive: For those that are really dedicated to their financial future and are driven by goals, take those funds and put them towards that short term goal you have set. Maybe it’s to buy that house for you and your boys… or maybe the significant other is pushing to settle down. Whatever it is, here is your opportunity to put a dent in the goal and feel accomplished!

Be Smart: (Disclosure – this doesn’t mean that you aren’t smart if you choose any of the other options). With this decision, you are really taking a step in the right direction to creating financial stability. Take the tax refund and pay off some of that stingy debt you have. Nobody likes a bank or lender breathing down their neck, here is your chance to push those bad boys away.

Be Boring: YAWN! Boring is sometimes the best ingredient for succeeding, but it sure as hell isn’t intriguing. By boring, you could look to build up some of your emergency reserves. It’s ideal to have about three to six months’ worth of expenses, so maybe Uncle Sam can get you to the desired level right away and we can move on from this boring state!

Be Ridiculous: Alright, we all know we have dream vacations. Well, this is your opportunity to use some found money to buy that plane ticket to your dream destination. But remember, you need some money for a place to stay, and you have to get back… maybe.

Be Spontaneous: This wasn’t part of your savings plan and you want to share it with those close to you. Then stop reading and take those co-workers of yours out for an early happy hour. Or, round up the gang and see if they want to meet for some early afternoon chaos!


Uncle Sam won’t make you rich

Whichever action you choose, or if you choose to go with option 6—none of the above—make sure not to let this one-time inflow change your financial strategy.

We must set goals to get our financial foundation set and that begins with getting rid of debt, building up some cash and saving for near term goals, along with those longer term desires.

We can’t rely on Uncle Sam to help us reach those goals we have of owning our own home or being able to afford kids.

In our office, we tend to use a saying “don’t let the tax tail wag the investment dog.” Meaning, that we shouldn’t make investment decisions based solely on the merit of the tax outcomes.

So, for those determining which action to take, just remember, don’t let your tax refund wag your financial dog!


Related Blog Posts:

Leasing A Car Is Not Black Or White

A Starter Home That Ignites A Future Flame

Estate Planning Basics

The Ultimate Dividend . . . That Of Virality

Will Getting Married Hurt Or Help My Taxes?

Like what you’ve read? Subscribe to our mailing list