It’s that time of the year again, tax season! It’s natural to feel the urge to splurge with your tax refund. After all, you work hard, and you deserve to treat yourself. Taking a step back and evaluating your financial goals is also crucial.
Living paycheck to paycheck or close to it, let’s face it, is the reality for most of us and can be a struggle, so getting a lump sum of money will naturally compel you to buy everything you’ve wanted to splurge on. So, please buy the bag, the tv or the car. But let’s take a step back and use this time of year to truly evaluate your financial situation with a little planning and strategic spending, you can set yourself up for financial success. Investing in yourself should be your first and most important purchase. Think about your personal goals and what you need to achieve them. It could be as simple as taking a class, learning a new skill, or investing in your mental health by seeing a therapist.
While rewarding yourself is essential, it’s equally important to be strategic with your finances. The uncertainty in our economy calls for smart financial planning, and there are a few important things you should do with your tax refund every year to secure your financial future. The tips are below:
- BUY LIFE INSURANCE and pay the premium up for a year. Realistically, if things get tight, you will pay your cell phone bill before life insurance. So to eliminate the burden of an additional monthly bill, just pay it up for the year.
- Leave the majority in savings to use towards the purchase of a home if the goal is to be a homeowner.
- Start a business that will generate more income in the future. An investment for the future.
- Pay off high-interest debt.
- Start or increase your emergency savings fund. Life is unpredictable, and having an emergency fund can help you avoid dipping into your credit cards or taking out loans when unexpected expenses arise.
- Consider investing in a retirement plan. Many employers offer 401(k) or similar plans, which can provide significant tax benefits. By starting early, you’ll benefit from compounding interest, which means your money will grow exponentially over time. If you are self-employed and/or own a business, seek out a financial advisor to guide you.
- Invest in a trip or vacation. Self-care is super important to your mental health and will allow you to think clearly without the stress of daily life.
- Invest in education, career development, personal development, or business development. Investing in oneself can be a great way to improve earning potential and overall financial well-being. It’s also a great way to generate new ideas and network with people you wouldn’t normally see on a daily basis. Take a course, attend a conference, or purchase professional development materials.
As black women, we face unique challenges when it comes to financial stability. But by investing in ourselves and following these tips, we can take control of our finances and secure a better future for ourselves and our families.
Article Written by: Khadijah Phillips| Khadijah Phillips is a highly driven woman who was born to break barriers. She proves that when powered by purpose, women are unstoppable. She’s built her storied life and career brick by brick, fighting fears, failures, and setbacks to have the success she’s always known was hers to claim. Today, she personifies what it means to ascend above adversity while inspiring countless others to do the same through her media company and strategic partnerships. You can follow her on Instagram @bestiesmedia and check out her website www.bestiesmedia.com.