Hi folks! I know that the month of
April is associated with rain showers, the dawn of a new baseball season and
that ever present evil of filing taxes but as many of us have already (or will
very soon) received our W-2 forms from our employer, what we are going to do
with our tax refund is foremost in our minds.
The list of things to do with that
eagerly anticipated refund is endless. Take
a vacation and/or buy a new car or some other big ticket item is usually what
flits thru our minds, but what about saving a portion of that money? If I’ve activated the killjoy button in your
tax refund fantasies, I am sorry but this blog is devoted to assisting with
financial issues.
When it comes to saving, most
experts state that we should save 10 percent of our take home pay. “Pay yourself first” is the mantra that
professional financial counselors cite all the time, but for most people living
paycheck to paycheck, 5 percent of take home pay is a challenge much less 10
percent. What can be done?
If you have a tax refund coming,
now would be the best time to commit to a savings plan. To make it easy, why
don’t we start with 10 percent of that tax refund, let’s pay ourselves
first. Think about it. Your tax refund is money that you have done
without all year and should be treated as found money. Let’s see what the 10
percent savings rule can do for you. If your refund is $1000.00, 10 percent of
that is $100.00. That is a nice way to
start a bank account or add to an existing one.
Once you have paid yourself, then consider a vacation or other big
ticket item. Also, if you have children,
let them in on the “paying yourself” first rule. It is never too late to teach
our young ones to be responsible with money.
In a few days, I will chat with you
about those refund anticipation loans tax preparers like to market to the
public. Until then, thanks for stopping
by for a visit at MoneySideChat.
Hank
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