7 Smart Ways to Use Your Tax Refund

7 Smart Ways to Use Your Tax Refund7 Smart Ways to Use Your Tax RefundHappy Tax Day! Right now all around the country Americans are scrambling to finish paperwork, searching for last minute deductions, and anticipating their refunds.

When that money arrives, the tendency is to treat it as free money - but it's not.

It's your money, and the government has been borrowing it interest free for the last year.

Related: 10 things that are cheaper to buy in April

That's why it's important to use it wisely. Set aside dreams of lottery winnings. Say no to frivolous purchases. Consider, instead, these ideas for putting your refund to good use:

Make Annual PaymentsMake Annual Payments1. Make Annual Payments
Some bills, like insurance, childcare, and gym memberships, offer a discount if you pay in advance. Making an annual payment can not only save a chunk of money at once, but you will eliminate a monthly bill for the next year.

Pay Off DebtPay Off Debt2. Pay Off Debt

If you are working your way out of debt, every extra penny should go towards your pay off plan. Just add your tax refund to your next payment to get out of debt even sooner.
Get tips on how to get out of debt

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Build Your SavingsBuild Your Savings3. Build Your Savings

Step one of a good debt management plan is to create an emergency fund. This way, if something comes up, you can pay cash instead of turning back to credit cards. A savings account with $1000 is a decent beginning.

Budget for GiftsBudget for Gifts4. Budget for Gifts

Don't let holidays sneak up on you this year. I love to be able to buy things my kids are talking about, as they go on sale. Set aside money for gifts now, and you'll be able to take advantage of deals throughout the year.

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Home ImprovementsHome Improvements5. Home Improvements

If you're going to put money into your home, focus on items that will increase its value or save you money. Energy efficient improvements like windows, doors, insulation, and appliance upgrades are a good place to start.

Related: 11 things I LOVE about my husband being unemployed

Family MembershipsFamily Memberships6. Family Memberships

Purchasing memberships to your favorite destinations is a great way to save money on family fun. Consider purchasing children's museum memberships, bounce house passes, and season tickets your kids will love. You'll be spending the money all at once, then be able take advantage of "free" admission the rest of the year.
Learn more about family memberships

Save for CollegeSave for College7. Save for College
Use the money to start a college savings plan for your child. A College 529 Plan offers tax advantages and helps you prepare for the high costs of college tuition.
Get tips on saving for college

- By Heather Sokol
Follow Heather on Babble

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