Black Belt Shopper
(featured column)

What Will You Do With the Tax Rebate of up to $600 You Have Coming?

by Larry Wiener

The question I always ask myself when I get some extra money is this: "How can I use this money so that five years or more from now my life is better because of the way I decided to spend this money?"  More...

If you don’t know, there are plenty of advertisers who will have ideas on where that money should go. Home Depot has a special no-interest loan if you want to use it for home improvement. The various mutual funds and brokerage houses will be reminding you of the usefulness of an IRA. No doubt cruise companies, credit card companies, appliance stores, and a host of other advertisers will have ideas on what you should do with that money.

Some of these advertisers have good ideas. Home improvement and investing for retirement are good uses of money. So are appliances and if you are caught up, a special vacation may be just what the doctor orders. The point is, however, that you, not the advertisers should decide what you are going to do with this rebate.

As with any windfall, you would be best to think this over and discuss it with your spouse if you have one. The question I always ask myself when I get some extra money is this: "How can I use this money so that five years or more from now my life is better because of the way I decided to spend this money?" I find that keeps it from going into a black hole of restaurant meals, junk that clutters the house, and, well, you know.

To help guide your thinking and discussion, here are some uses you may want to consider:

Pay Down Debt

If you have credit card debt that you are paying down, paying an extra few hundred when you get your check will help you reach a zero balance sooner.

Fund a Reserve

Experts say that you should have from three to six months in a reserve account to fund emergencies and other unexpected expenses. This money should definitely not be in the market. If you don’t have a reserve or if your reserve is underfunded, this would be a good use of your $600.

Buy Something Enduring

If you are not in major debt and have a reserve, you might want to buy something that will improve the quality of your life for a long time. If you are a music lover, for example, you may want to buy a really good stereo.

Repair or Upgrade Your Home

If your home is starting to show wear, you might want to take that trip to Home Depot to repair the home. Not only will you enjoy the more upgraded home, but your repair or improvement might add value to your home.

Invest It

You can use the money to start or add to an IRA, a college fund, or other type of investment. This site is full of ideas on investing if you need some.

Save It for Later

Maybe your house and balance sheet are in great shape. You can’t think of anything you really want to buy now. Rather than consigning it to the black hole, you might want to put it in your savings and if in the next year you see something you want or need, you’ll have that money available.

Give Some of It Away

Our country is full of ministries and charities that are worthy of donation. Remember them when you get your check.

So What am I going to do with my check?

Don’t know. Haven’t thought about it yet. But I will before I spend the money. Hope you do too, rather than letting the advertisers make the decision for you.

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Copyright © 2001 by Larry Wiener, author of The Black Belt Shopper's Guide. All rights reserved.

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