Tax season is around the corner. This means you are probably starting to think about the best way to use your refund. We have already discussed five things that you should do with your tax return this season, but what should you not do?
Once you get your refund, you may be tempted to spend that big chunk of money. Don’t! Decide to take control of your funds and become financially fit instead.
Watch my video below for 5 things that you probably shouldn’t spend your tax return on.
1. Don’t Take a Vacation
You will be tempted to take your tax return and go lounge on an exotic beach. Even worse, you will probably spend your return and then some.
We want to get our money working for us, not the other way around.
2. Don’t Buy a New Car
You should not jump into a big purchase that is not an asset. It will not produce a great return for you. A new car will not impress anybody. Use the money instead on building your retirement.
If you do choose to buy something, make sure it is a good investment with a great interest rate.
3. Don’t Loan Your Money to Your Neighbor
It is a kind gesture to help people out, especially when they are desperate for money. But you have a responsibility for your family and your own future.
You have to take care of yourself. Your neighbors need to be able to take care of themselves too.
4. Don’t Go On a Shopping Spree
Once you’re making money, it is easy to get carried away on a shopping trip. Once you are getting a 15% return and have capital stacked away for your retirement, buy something expensive.
Until then, save your cash.
5. Do NOT Give Your Money to a Mutual Fund Manager
Don’t give your money to a mutual fund manager. Almost none of them can beat the market, and get classically low returns. The commissions and fees they charge will chew up your retirement fund.
You can manage your money a lot better by yourself.
Take Control of Your Own Money
Bottom line, it’s much better to invest on your own rather than pay a fund manager to get you 3% returns. That’s going to get you nowhere in 20 years. Learning how to invest with Rule #1 is a surefire way to an early retirement.
What are you planning to do with your tax refund? To learn how to take control of your money and become financially fit, I want you to take my 14-day challenge. All you have to do is click the link on the screen in the description and it will take you right over to it.
Phil Town is an investment advisor, hedge fund manager, 3x NY Times Best-Selling Author, ex-Grand Canyon river guide, and former Lieutenant in the US Army Special Forces. He and his wife, Melissa, share a passion for horses, polo, and eventing. Phil’s goal is to help you learn how to invest and achieve financial independence.