As the tax preparer’s in our area take a deep breath after April 15, what are some ways that you can utilize a tax refund?
It is easy to use a tax refund to splurge on fun things or even things that you have put off purchasing. I have certainly been in that position!
Another way to look at it is to divide your refund up into several priorities. Just like day to day expenses, building a budget can be helpful.
First, do you have bills that need to be caught up? Next, can you set aside a small portion toward savings? Finally, can you set aside a small portion for an inexpensive family activity or dinner?
Your tax refund may not cover all of every bill. However, applying an extra portion from your tax return to each one can definitely help in making progress. In some cases, it may make sense to evaluate the one(s) with higher interest to make a priority.
Do you have a savings or emergency fund established? Most financial institutions do have minimum balances and limited withdrawals to avoid fees on savings because the accounts are intended to help you save, not constantly move money in and out. United Way of Central Kansas has put together a great program “Bank On Central Kansas” and works with several community partners to provide access to safe, low-cost, and functional bank accounts. You can find out more about this program at Bank On Central Kansas | United Way of Central Kansas at uwck.org/bankon.
Finally, when you have been working on a very thin budget, it is hard to not celebrate making progress. Pack a picnic lunch and spend some time at the zoo! Splurge a little (a little is the important word!) on fun snacks, sidewalk chalk, bubbles, and a new ball for a family game night in your own yard. Does your family regularly cook together? If not, pizza night where everyone helps prepare toppings and makes their own mini-pizza can be an economical and fun family experience.
Whatever way you put your plan into place, talk about it with your family. Littles can begin to understand that planning and savings, while taking care of responsibilities, are important life skills. These are all ways to model behaviors and set examples!
Keep learning. Keep showing grace and kindness!
Michelle Beran is a Family and Community Wellness Agent in the Cottonwood Extension District. For more information on this article or other K-State Extension resources, email Michelle at mberan@ksu.edu or call Cottonwood Extension District – Barton Office at 620-793-1910.
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