TODAY on It's Payday! Is Your Tax Refund an Opportunity or an Obstacle?

Are you one of those people who are happy when you get your tax refund and sad when you are broke?

So many people have either received or are starting to receive their tax refund money. Some people use this money to position themselves to get ahead financially. Others use this money to buy a bunch of things they don’t need and regrettably end up in more debt. We are facing a challenging and sluggish economy. That leaves me with one directive: use your tax refund to position yourself to get ahead. Don’t be one of those people who spend all their money and end up singing the blue. On It’s Payday!, I talked about the It’s Payday! 50/25/25 plan.
03-25-11 Tax Refund Opportunities by ItsPayday

The It’s Payday! 50/25/25 plan is a formula that will help you get ahead this year. It involves splitting your money three ways.

50% for Your Emergency Fund- Use the first half of your refund to start or bolster your emergency account. There is a certain peace of mind you get when you know that you can manage life’s ups and downs. You can use this money when times get tight. That way you avoid high-interest credit cards and predatory lending. This saves you money in the long run. If you have an emergency fund, use this money to invest in appreciating assets that will help you build wealth in the future.

25% for Debt & Bills- Use the next quarter of your refund to pay down debt and catch up on bills. Remember, having a low credit score makes everything more expensive.

25% for Fun- Family should be the motivation behind our struggle. After you take care of business, use the last quarter of your money to have fun and invest in your family.

I take my hat off and salute you. You are surviving a very challenging and uncertain economy. Let’s use this refund money to stop living paycheck to paycheck.