Why Not Start Now?

by Jeff C. Johnson

Now that you have your tax refund (or have paid your additional income taxes due and have some cash left over), what should you do with the money?

I can appreciate that you might feel a strong urge to use this "windfall" to splurge on anything from a night on the town to a new car. Maybe a trip to the beach for a couple of days. Why not?

Well, I'm not a fun hater, and I'm not here to tell you what to do. However, consider how you are doing on the Five Financial Foundations.

  • Do you have a cash reserve account for emergencies?
  • Are you funding your retirement plan at work or your IRA?
  • Do you have an account for a future major purchase, like a car or a house down payment?
  • Should you pay down (or pay off) some lingering debt?

These are questions that the money-savvy people I've known have asked themselves.

Perhaps the best solution, and one that I favor for myself, is to save some, invest some, and spend some of the money.

Make the right decision for you.