This year, the IRS has extended the federal tax filing deadline from April 15 to July 15, giving taxpayers more time to prepare their returns. But, if you're expecting a refund, it might be a good idea to file as soon as possible so you can receive your money faster.
If you do receive a significant refund this year, you might be wondering how to make the most of your incoming money. How you use your tax refund is up to you—it's your money! That said, here are a few ideas to consider:
#1: Contribute to your retirement account
One smart way to use your tax refund is to build your retirement fund. The earlier you save for retirement, the more time your money will have to grow through the power of compound interest. Plus, depending on the type of retirement account, you might be able to deduct some of the contributions on your tax return for next year.
#2: Boost your savings goals
Another way to use your refund is to help you reach your biggest savings goals. Maybe you're saving up for a new car, a home remodeling project or a big family vacation. Your tax refund could be the boost you need to reach your goal faster! To help you save towards several goals at once and stay organized in the process, try opening a separate savings account for each one.
#3: Invest in career-building training and education
Sometimes, the best thing you can invest in is yourself. Think about using your refund to help pay for extra training, an advanced certification or an educational conference. These activities could pay off in a promotion and a brighter future for you and your family.
#4: Give back
Giving back to others feels great and may provide tax advantages. Consider donating part or all of your refund to a favorite charity or local organization. The Federal CARES Act recently made some changes to provide additional tax benefits for charitable giving.
No matter how you choose to use your tax refund this year, Wright-Patt Credit Union (WPCU) is here to help you manage your hard-earned money and reach your financial goals! Visit our online Education Center for more helpful tips, tools and resources.