Spend Your Tax Refund Wisely - Newschannel 6 Now | Wichita Falls, TX

Spend Your Tax Refund Wisely

Tuesday was the deadline to file your taxes. If you have gotten a refund, the National Foundation for Credit Counseling offers the following tips about how to spend your refund wisely:

· Pay down credit cards or other high interest loans. Use your refund to pay more than the monthly minimum payments.
 Add extra cash to loans with high interest rates, or totally pay off smaller obligations. Remember, credit card debt 
is simply an unsecured loan. The longer the life of the loan, the more you'll pay for borrowing the money. 

· Pay down your mortgage.  Put extra money toward the principal on your mortgage. Paying off your mortgage faster means you pay less in interest. Using your refund to reduce your mortgage debt can mean substantial long-term savings. Use an online calculator to see the impact of making just one extra mortgage payment each year.  

· Contribute to or open an emergency fund. The NFCC's 2014 Financial Literacy Survey revealed that 34 percent of Americans have zero non-retirement savings. Your tax refund is a great way to start or build your rainy day account. By placing the cash in a separate savings account, you're going to be less likely to use it, thus it will be there when the emergency or unplanned expense comes along.

· Plan for retirement. Many people are now working after the normal retirement age of 65. For a number of reasons, retirement is not an option for many. The Financial Literacy Survey suggests why: 32 percent of respondents indicated they save zero toward retirement each year. The sooner you start saving, the more time your money has to grow. If retirement is many years away, it's all the better.  Start planning now by making retirement savings a high priority, 
setting goals, devising a plan and sticking to it.

· Make needed repairs. If you've put off getting an oil change, cleaning the gutters or fixing the leaky roof. Now's the time to cross those things off your list. 

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