Hopefully, you filed your tax return on time (it was due April 30th) and you’re now expecting a refund in the mail. According to Canada Revenue Agency, most Canadians are entitled to one, with an average total sitting close to two thousand dollars.
Depending on who you talk to, this tax refund could mean one of two things: extra money to splurge, or an opportunity to use your money meaningfully. Believe it or not though, we tend towards the latter decision. If you’re looking for something smart to put your money towards, here are five ways in which you can spend your money responsibly.
We know it’s tough but you should try to resist the temptation to spend your refund right away. To be frank, one of the best places to put it is in the bank, whether that’s into an RRSP or a tax-free savings account. If you’re saving towards your first down payment, or are trying to move on from your starter home, there’s perhaps no better way to go.
Pay Off Debt
Another great way to use your money is to pay off any outstanding debt, such as your credit card or student loans. By paying off your debt, you’ll reduce any interest on these loans. The less you have to pay on interest, the more money you can spend on your living expenses.
Invest In Your Home
If you already own a home, investing your money in it is a great way to go. While your average tax refund won’t be able to finance a complete renovation, it will be enough to get you started on smaller projects or repairs you’ve been meaning to take care of. There are many different home improvement projects you can take on, such as renovating your garage, creating a social space, or installing new types of windows. Whatever you decide to do, investing in your home will both increase its value and enhance its overall livability.
Improve Your Curb Appeal
In case you’d rather spend your money elsewhere, the exterior of your home is another fantastic investment opportunity. Curb appeal, which refers to the attractiveness of the outside of a residential or commercial property, as viewed from the street, helps attract potential buyers to your home and is a great selling tool. There’s a wide range of improvements you can make, including everything from wind and rain reinforcements to landscaping projects.
Boost Your Mortgage Payment
When it comes to paying your mortgage, everything counts, including the two thousand dollar tax refund you received. It may seem like a small contribution, but has implications for the amount of interest you pay and principal you receive.
As fun as a shopping spree may sound, see if you can put your tax refund to good use. There are so many different ways you can spend it, it would be a shame not to do it right. If you’d like to invest your tax refund in a home improvement project or down payment, contact us today at Pemberton Holmes.