Some Ways To Effectively Spend, Budget and Stretch Your Tax Refund

One of my personal favorite times of the year is here: tax season. It allows those that actually receive a refund a chance to recoup and recover from the Christmas frenzy, save up some cash for summer and beyond, and treat yourself and others. 

Many people, however, spend their refunds frivolously.  They go to Wal-Mart, the mall, online, everywhere, buying up stuff they could otherwise do without. 

Now I'm not saying don't enjoy your refund. You worked hard for this money from Uncle Sam. However a penny saved is a penny earned. Here are some tips to spend that money more effectively, and even stretch it out some.

1. Tithe 10% of it, or give a portion to a local charity.

Many don't realize you should tithe 10% of your refund to the Lord via your church. Well if you don't wanna do that or do not have a church to send your monies to, choose a church or philanthropy and go that route. The amount will seem small, but the impact will be monumental.

2. Take care of home and automobile.

Car commercials are everywhere now, as many car lots are still trying to clear last year's inventory.  Having your refund can make this possible.  However, if you already have a car note or you don't want another, use some of your refund for routine maintenance.  This includes tires, brakes, tune-ups, and anything that may need replacing.  Also, many that own homes already spend a lot of money at Home Depot or Lowes. You can take care of home improvements as well.

3. Pay off bills and get ahead.

Speaking of the aforementioned car note, it doesn't hurt to pay off your car, or put a dent in the note so the interest is lower. Also, this applies to other outstanding or huge upcoming bills.

4. Pledge to save about 10 percent for a rainy day. 

Regardless of how you spend the check, set aside 10 percent of it for an emergency fund. Put it in a credit union or savings and allow it to accumulate some interest. This will keep that money working for you.

5. Treat yourself. 

It's perfectly fine to do this, as long as you don't break the bank in the process. Go to that five star restaurant you saw on Yelp. Take that vacation or cruise this summer. Buy yourself some new electronics, clothes, or gadgets. Some retail therapy and money to get away is actually healthy.

6. Take care of needs, then wants

This is the theme I'm driving towards.  You should pay down as much debt, and take care of any and all needs you can before having fun with your funds. You will enjoy it more having that peace of mind.

7.  Set a budget for each spending purpose. 

I typically write a list of things that I need to take care of, along with a wish list. I try to make it as reasonable as possible, and ensure I still have money left over. This is discipline with your windfall.

Remember this is tax season, not the lottery. You aren't rich, just a little blessed. Just take proper care of your blessing and don't get quickly separated from your monies.

Cheap v. Economically Sound: More Tips on Spending and Saving Wisely

Ok after a week off from blogging, slight burnout, and being under the weather, I'm back and talking about one of my favorite subjects: saving money.

Now I'm no Dave Ramsey, but I am becoming adept at saving money, and I learned years ago how to make a dollar out of 15 cents. Therefore, that's why I refer to myself as the "Economically Sound Brotha" . I don't consider myself cheap, which is what many consider me. I buy nice things, but in moderation and in timely fashion. Here are some examples of the differences between being economically sound and just cheap.

Cheap: Only buying shoes when your good ones are all worn down.
Economically Sound: Buying a good pair of shoes when they're on sale, or during holidays, birthdays, or tax season

Cheap: Never eating out and/or always eating mac n cheese and Ramen Noodles
Economically Sound: Using coupons, Living Social specials, and other restaurant specials and offers and eating then

Cheap: Taping movies onto DVD from your DVR to avoid paying the full price (or even burning the DVD)

Economically Sound: Buying movies when Wal-Mart marks them down, joining Columbia House to get several movies for cheap, or taking advantage of the thousands of movie stores closing nationwide

Cheap: Buying everything generic. You don't have to be brand loyal to understand that for certain sproducts, only the name brand can do the job

Economically Sound: Knowing which brands are effective but affordable. For example, Claritin v Zyrtec, Wal-Mart Dickies v. Belk Dickies (they're the same, trust me)

Cheap: Holding onto your 2006 Razr phone because you don't care for another phone or don't wanna pay for it.

Economically Sound: Waiting until the hottest phone has been out for a while, and bundle the discount with your rebate. One can earn a top notch phone at an affordable price.

Cheap: Trying to do car or home maintenance yourself when you're not much of an expert on either

Economically Sound: Going to a mom and pop repair shop, or paying a trusted friend or family member who's good at repairs and maintenance

Cheap: Going road tripping for your vacation week

Economically Sound: Saving a few bucks out of each check for a year, plus any extra money or windfalls, to have a real, top-notch vacation

Okay I hope you all get the point now. Yours truly does spend his money, just wisely. You can't take it with you when you die, but you should understand how to handle it while you're alive.

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