It’s the beginning of a new year. For many around the country, focus begins to shift to taxes (cue ominous dah, dah, dahhhh in the background). W-2s, what can and can’t be deducted, which tax software to use, and…REFUNDS. April 15th arrives in the blink of an eye, but that’s now usually what the hubbub is about. Tax refunds are a welcomed relief to some and the silver lining to arguably exorbitant amounts withheld from our hard fought salaries and wages, for all.
The first question after the humbling realization that it’s tax time again, is if there is going to be a refund, “What to do with it?” The quick answer is to treat yourself, using the funds to reward yourself for the previous 365 days of hard work. Or, treat your family to some special treat or gesture; something you couldn’t manage for the holidays. Nice ideas, and there can certainly be an argument made for both options. However, think about it like this, what does your family really need? Is a true reward for you or treat for your children something of temporary pleasure or maybe something more long-term?
Whether you usually choose some version of “rapid refund” or you delay gratification and wait on a check through snail mail, we beg of you, MAKE GOOD CHOICES! What are good choices? A lady was recently contacted by her annual tax-preparing company, advising—without official W-2s, or accurate knowledge of her previous year’s earnings—that she could come in for a quick file and receive an advance on her expected refund, with just her last paystub! This woman is very attuned to her financial needs and responsibilities, and made the choice to forego the quick fix to possible financial need. She stated, “I can always use the money for something, but it’s not worth what I may leave on the table by guessing what I made.” She went on to say there’s a specific amount of money she needed to pay her property taxes. Getting some of the money and trying to hold onto it while waiting for the rest wasn’t a gamble she was prepared to take.
The chain tax-preparers serve a need, but they are not concerned with what a true, accurate accounting of your income and what a proper refund could mean to you and your family. Their singular goal is to get you into their office instead of their competitor’s. They need to dangle enough incentive to prevent you from plugging your numbers into some software. Whether your refund will be large or small, a good choice is always to invest it in something meaningful for the future family, not a post-Christmas sale on boots and electronics. If it’s not enough to do anything with, save it, add to it and then invest. What’s more rewarding to you and your family than to able to advise that you bought a house on your future tax forms?
When you make good choices with your long-term financial future in mind, you can begin to look forward to tax season for an entirely different reason…REAL-ESTATE INVESTMENT! For your family or financial security. It’s worth it!
