This post may contain affiliate links. Read our disclosure here.
Before I get into my ideas for smart things to do with your tax refund, I need to share the smartest thing about tax refunds: don’t get one! A tax refund essentially means you’ve been letting the government have your money for the past year. If your refund is substantial, consider adjusting your withholdings or figuring out what you actually owe in the coming year. That said, sometimes even when you’re trying not to get anything back, your circumstances change and you find yourself with a substantial windfall this time of year. Here are 50 ideas for what to do with that money (or any windfall!).
50 Smart Things to Do With Your Tax Refund
Build up your emergency fund (or start one!)
Set it aside for Christmas
Fund an HSA
Put it in a 529 education plan for your kids
Put it in a high-yield savings account
Save it for back-to-school expenses
Create a car maintenance fund
Save for a wedding
Put it in a CD
Save for a new car
Save it for a down payment
Make an extra payment on a car loan
Pay off medical bills
Pay off student loans
Make an extra mortgage payment
Pay off high-interest credit card debt
Max out your retirement contributions
Open a money market account
Pay annual subscriptions up front
Get a month ahead on your budget
Install a programmable thermostat
Replace old mattresses
Upgrade your lighting to LED
Add weatherstrips to your home for insulation
Replace an older appliance with a more efficient model
Improve your backyard and other outdoor spaces for summer use
Save for future property taxes or insurance payments
Upgrade kitchen tools to encourage you to cook more at home (ex: knives)
Buy items for emergencies – weather radio, chargers, etc.
Buy a smart power strip
Replace or buy new tools for repairs
Buy solar panels
Schedule needed medical and dental appointments you’ve been putting off
Set aside for future benevolence
Put it toward a family vacation
Invest in health or fitness equipment
Buy quality walking or running shoes
Go on an anniversary or birthday trip
Spend it on a hobby
Start a small business
Learn something new (Masterclass is a great option)
Pay for financial planning advice
Attend a conference or workshop
Purchase bulk storage containers
Buy food in bulk
Start a raised bed garden
Buy a chest freezer
Purchase reusable items to replace consumables (paper towels, ziptop bags, napkins
Buy a water filter
Create a budget category for stocking up on items when they’re on sale
One bonus idea is pretty counter-cultural: give it away! Donate it to your church or another worthy nonprofit. If you know of any missionaries, see if they have any one-time needs you could put your tax refund towards.
