It’s July and you have received your PAYG Payment summaries and it’s time to lodge your tax return and hopefully receive a refund. The average refund issued by the Australian Taxation Office is just over $2000, the question is, what plans do you have for your refund?
Keep in mind your refund isn’t a windfall, it’s basically your money that you are getting back at the end of the year as you have paid to much tax throughout the year.
Here are 6 ways to use your tax refund to your advantage.
1. If you have a home loan, use your tax refund to pay off a lump sum of your loan, the lump sum will reduce the principle of the loan and then the monthly interest amount will be reduced too, in short, any lump sum payments will shorten the life of the loan, no matter what the amount is.
2. Invest in self-education, whether you start a course that will help you get a promotion at work that will, of course, increase your take home pay. Otherwise, you could learn about a hobby or a passion, which will help you grow and become a more knowledgeable person.
3. Put your tax return towards retirement, make a voluntary contribution towards your current super fund, This money will accumulate interest and your will have a larger nest egg when you retire
4. Make a donation to your favourite charity, I am sure that you have a favourite, plus the donation will result in a tax deduction for the following year.
5. Take care of Yourself, now that you have a few spare dollars, make that appointment to see your dentist, doctor or masseuse, or even buy a 12 month membership to a gym.
6. Splurge a Little, do something for yourself, do some retail therapy, book a trip away, go out for a meal or a movie, find something that you enjoy and use your tax refund to do it.
How do you intend to spend your tax return, take a moment and add your suggestion in the comments below?