SAN DIEGO (KGTV) - The IRS says 70 percent of taxpayers will get a refund this year, with the average taxpayer getting around $2,860. What you do with that money is a personal choice, experts say, but they do have some suggestions.
"Savings is always going to be at the top of the list, but it's also money you've earned," said Seth Kaplowitz, a finance Lecturer at San Diego State University. "So if it's something that can benefit you or your family, then invest in that."
Kaplowitz said the best thing to do is save the money, especially in an emergency fund. He recommends having three months' worth of salary on stand-by, just in case.
He also said if you want to splurge on a big purchase or vacation, "Ask yourself, 'Is this something that I must have or is this something I can do without?'"
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Other options financial experts have:
- Invest the money (either in the market, real estate or in your retirement fund)
- Pay off credit card debt
- Put it towards your mortgage
- Set it aside to pay your taxes next year
- Invest in your home with an improvement project (which could also raise the value of your home)
- Invest in yourself or your career (training courses, health savings, exercise classes or equipment)
- Take a vacation (to relax and de-stress)
No matter what you decide, Kaplowitz said the main point is to think about where every dollar goes and make conscious decisions, not spur-of-the-moment ones.
"I would say be cautious about how that money is spent. It should be well thought out," Kaplowitz.