Building on my last post, I thought it would be a good idea to talk about what to do with that beautiful refund that comes your way in April.
Many will advise you to invest in your RRSP! That is a great option – and creates this endless cycle. You get money back in your tax return, so you invest in your RRSP, so you get money back the next year, so you invest in your RRSP….what a great system.
Sometimes though we want to see some more immediate fruits from our labour. Rather than going on a spending spree (which will most likely result in buyers remorse), here are five creative ways to spend your tax return, without the shoppers guilt. The key to each of these options is that you are making your money work for you. Sure $2,000 is nice, but what if you could turn that $2,000 into $3,000….or $10,000?
- Further your education – Maybe it’s that career change you’ve always pondered but never acted on. Maybe it’s a photography class to start up your freelancing business. Maybe it’s an outdoor pursuit class so you can lead nature walks on the weekend. Whatever the reason, think about how going back to school could expand your skill set and open doors for the potential to earn additional sources of income.
- Home improvements – Ever wonder why your energy bills are so high? Maybe it’s time to switch to energy efficient lightbulbs, get the furnace tuned up, change filters, insulate the windows and get rid of those nasty drafts that are racking up the utility bill. Want an easy way to save $100’s of dollars next year. This is it.
- Buy new appliances – Nothing screams energy drain like twenty year old appliances. Technology is constantly improving and appliances are much more energy efficient than they used to be. Replacing your fridge, stove, dishwasher, washer and dryer all at once can be a bit overwhelming – try creating a schedule where you replace one of these items every 2 years. Knowing what is coming up for replacement will help you keep an eye on sales too.
- Buy. A. Gym. Membership!! – This one is kind of funny. I’m sure many people will disagree – how can buying a gym membership save me money?! The key is to think long term. There are so many benefits to having a healthy lifestyle! A healthier and fitter you will get sick less often, which means fewer days off of work, and fewer dollars spent at the pharmacy. Not to mention, there is a good chance that while you are at the gym, your friends are at the bar for happy hour – now your abs AND your wallet will thank you.
- Early Christmas Shopping! – Okay, I can see how this one may be a bit of a stretch but just hear me out. If you put this money away for Christmas shopping, and actually do Christmas shopping throughout the year, you ARE going to save money! How? You will pick up items on sale. You will be shopping out of season. You will spend less time driving around in circles in parking lots, less money on gas, and less money on the lattes you inevitably buy because you are dog tired from walking around the mall for four hours but still have four more hours to go! phew. I’m tired just typing that.
So there you have it. For those of you itching to spend the refund, there are five unconventional yet extremely useful ways to spend your tax return, guilt free.