4 Things To Do Before Spending Your Tax Refund Check

I feel like there's this love-hate relationship when it comes to taxes. It comes at the same time every year and is known to have the same dread. First, choosing who to file with and then hoping it's done right. Then, hopefully, we don't end up wondering "how in the world I owe this much!?".  

For now, we'll talk about the better side of taxes with refund checks! 

It's the one thing we look forward to, pray we get, and unfortunately... spend too soon. It's such a common culture for people to spend their checks before they get it. I want to question: Is it being spent in the best way?

I'm not saying that refund checks shouldn't be spent on rewards or splurged. Sometimes we need to experience the pleasures of life and treat ourselves. I do however want to be sure when we spend we feel good about it. Here is a list of some things to consider when receiving your refund check.  

Things To Do Before Receiving Your Refund Check:

1. Stay consistent

Staying consistent with your spending. Increasing your spending forces you to have to contribute money from your income check to cover your expenses. Unless you know the best option for you is to splurge your check, keep to the usual spending habits that you have been maintaining. Remember you're getting the refund once.

2. Plan

When deciding what to do with your tax refund check look at the whole picture. Where are you with your spending, debt, savings? Do you want to invest more? Are there events coming up? Travel? Do you want to use it for a boost in your financial goals or have you been working hard towards them and need to spend some money on what you enjoy? Planning and writing out all your options allows you to see where the money will best benefit you. More than likely if you've thought it through you will have reason for your decision and no regret after the money is gone. 

3. Wait

It's so easy to get excited when receiving a lump sum of money. Or even feel pressure to spend it the right way. Making quick decisions and not thinking completely through your options can result in you sending the money to places you regret later. While deciding what to do with your check, do not make any instant decisions. Wait and ponder your options on what you want to spend on to prevent impulsive spending. 

4. Reflect

Remember this is a one time check, not a pay increase. Where can you allocate the money that will give you the most peace?

There are so many ways to spend your tax refund check effectively. Everyone's financial situation looks different, but here are some options to consider:

• Starting or contributing to an emergency fund

• Saving for unexpected/irregular expenses (Birthdays, events, holidays, etc.)

• Catching up on bills

• Paying down debt

• Invest

• Buy something nice

• House/Car repair you've been waiting on

• An Experience (fancy meal, concert, Broadway show, class, etc.)

• Getting a month ahead in your budget (step forward from living paycheck to paycheck)

In Conclusion

It's not really about what we spend our money on, but more so what we've been doing, are doing, and how we feel about it. I challenge you to write out your options and see what works best for you this year. 

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