4 things to do with your income tax

2 Mar

You and Your….Money

4 things to do with your income tax…before you spend it all on nonsense.

I need to make a confession: I’m your stereotypical tax refund fiend. I can’t wait to see how much I’m owed by Uncle Sam and, like other child-free and unmarried twenty somethings, I usually get shafted every single year. According to Uncle Sam, the real money is in having kids. It kinda sucks because the cost of living is rising everywhere, major cities and small towns alike, we could all use the extra money. Why isn’t there an everyday working people tax credit? A paying your bills on time kickback? I could use a free Metrocard or something every once in a while, but I digress.

At times my eyes get bigger than my stomach, and I’ve had more than my fair share of post tax season buyers remorse. The excited anticipation of waiting by the mailbox or online bank screen for your check to arrive and the rush of dreaming new and elaborate ways to spend the money.  Before you run out to the outlets for the newest top of the line cappuccino maker or late night infomercial workout equipment (Shake Weights included) consider all of the options before you swipe your debit card.

Take a Vacation

Let’s face it: most of us do not take as much time off from work as we should.  No matter your profession we can all benefit from a vacation. Even if it’s to a neighboring city or state for a few days. Getting away from your everyday environment can be a nice way to psyche yourself into a better mood. When you come home from a getaway you’ll feel refreshed and happy. If you don’t already have one get your passport. It costs around $130 and the process takes about 4-5 weeks.  Check out bookit.com and kayak.com for amazing deals on hotels, airfare and vacation packages. If you’re like me, a 25-year-old non driver, go for your driver’s license. I’m actually looking forward to the freedom of being able to drive. Can you say ‘road trip’ this summer?!

Pay Off a Credit Card

If you don’t have a credit card you can give yourself a financial edge in other ways by paying your rent a month in advance or making a double payment on a utility bill or student loan. Putting money towards ‘constants’ (expenses that need to be paid every month) gives you a little cushion for months where you might overspend. By paying in advance you’re giving yourself a little wiggle room in your budget. While you’re putting a little more to your bills think about opening a new savings account to stash extra cash. ING is an online bank that offers great interest rates. Check bankrate.com for other banking options. If you have no credit (no credit can be just as annoying as bad credit) take out a credit card if you need to build your score. A department store credit card can be easier than a regular card. Just read the fine print and be mindful of the interest rates.

Stock Up On the Basics

You can never be too prepared. Again, take stock of your ‘constants.’ You know you have certain things that you need on a daily basis: favorite foods, clothing, beauty aids, etc. Why not take a chunk of your change and spend it on things that you need? Check out half.com for gently used and new books at crazy low prices, drugstore.com for beauty supplies and if you have roommates see if you can chip in for a membership to a wholesale club like Costco’s, Sam’s Club or BJ’s. Buying household items in bulk can cut down on your day to day expenses and save time on unnecessary trips to the store.

A girl needs to have her tools!

Revamp Your Living Space

You don’t have to do a total renovation but changing a few things in your apartment or bedroom can do wonders for lifting your mood and brightening your spirits. Just by changing the curtains you can change the way you feel when you step into a room. If you’re crafty and are feeling up to task try a new paint color. Websites like Apartment Therapy and The Nest are great sources of design inspiration.

Overall you want to invest in purchases that will boost your quality of life. A hair steamer could be a nice treat if you’ve been dedicated to taking care of your own hair (shout outs to my DIYers out there). I have had my eye on a candy colored Kitchenaid mixer and I just purchased a Jack Lalanne power juicer (it’s worth every penny and it puts my old Black & Decker mini juicer to shame). Be honest with yourself about your level of commitment to the purchase. If you think that buying an expensive treadmill or cross training machine is going to motivate you to workout more than you can kiss that dream goodbye. Owning a piece of fancy equipment doesn’t make you any more a fitness junkie than having a grand piano makes you a pianist. If you have worked out in months treat yourself to some new workout duds and recommit yourself to your health. Theres nothing wrong with wanting luxury items but there’s no use wasting money on something you’ll use once or twice then abandon in a corner. While yesterdays fad is collecting dust and finding a second life as a coat rack you’re out of good money that would’ve been spent on more practical uses.

The trick to buying big-ticket items is research and delayed gratification. Think ahead: summer will be here before you know it and you’ll be wishing you put a little money on the side for that stainless steel grill you saw on the food network. We just want you to show you how a little forethought can help you work smarter not harder to enjoy your money guilt-free.

-Nikki B. Decadent

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2 Responses to “4 things to do with your income tax”

  1. Sia March 2, 2011 at 7:38 PM #

    Why isn’t “invest it” on the list? The earlier in your 20’s you start investing, the more compound interest you earn. Then you can retire rich

    • Roaring 20s March 4, 2011 at 12:05 PM #

      I totally agree and I actually had invest in its own category but I know absolutely nothing about investing. The post does recommend opening a new savings account though.

      Investing in your twenties can definitely be a post on its own. Thanks for the suggestion!

      -Nikki B Decadent

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