Ideas for Utilizing the Tax Refund

If you were one of the lucky ones, who have managed to get some already paid income tax refunded, then the next immediate concern would be to find ways for utilizing the tax refunded amount. Though there are no ready- made formulae available, one can follow the following strategy for spending their refunded tax amount.

You have to take out 10% of the tax fund and keep it aside for spending to satisfy your personal wishes and needs. The remaining 90% can be utilized in the ways. mentioned below

Starting a exigency fund. This would be useful to meet the emergency expenses such as unexpected travel and medical expenses. Using a portion of the 90% for making debt repayment Allocating a significant percentage of the refund in to saving instruments. This savings can be used to meet your long pending goals such as exchanging your old car with a newer one or buying a fancy electronic accessory. Allocating some portion of the refunded amount towards retirement savings. You can increase your contribution towards RRSP, if have already made significant investments in other saving instruments. Going on a vacation. This should be the last option. If there are no debts to be repaid or you have already made significant contribution to savings fund or the RRSP instrument, you can surprise your family by taking them on a vacation.