Everyone has a plan for your tax refund. Do you?

Practically every year starting in March, we are bombarded by advertisements from retailers telling us to spend our tax refunds in their stores. They entice us with discounts and sometimes even offer to cash out our tax refund checks. These promotions sound like a wise investment. However, your tax refund is not mad money. It’s not even free money. It is money that you worked hard to earn. Your tax refund is basically a savings account that has matured and is ready for you to use.

Retailers and car dealerships tell you to bring your tax refund to their stores and spend it on a new TV for the Superbowl, new clothes, appliances, and cars. It’s obvious they have a plan for your money, but do you? You spent the last 12 months sacrificing earnings from your paycheck to get that refund. Make a plan for it!

According to the IRS, the average tax payer received $2,803 from 2012 taxes. No matter how much you receive, whether it is $100 or $1,000, your refund could jump start your personal financial success in 2014.

Here are some ideas to help you make a plan for your refund:

• Pay off debt – Start with the smallest credit card balance or loan and work your way up.
• Make your refund a part of your down payment – Do you have good credit but struggle with savings for your down payment? Your tax refund could help you reach that goal.
• Start your homeownership journey – If you haven’t started working towards homeownership, put your tax refund in a savings account that you can’t touch. Talk with Homewise about starting your home purchase process. Remember: You are one step ahead of the game because you already have some savings.
• Pay down the principal on your mortgage – If you make one extra payment to principal every year on your mortgage, you could reduce your loan time by about 4 years!
• Boost your tax refund with energy–saving improvements – Visit Energy Saver to learn which tax credits apply to New Mexico. Homewise offers affordable fixed-rate loans to help finance energy-saving home improvements.
• Use it for refinance expenses – Save your tax refund to cover the appraisal fee for your home refinance. You could also use the refund to lower debt and help you qualify for a better interest rate and get a better payment!

Make a plan today. If you are working with a Home Purchase Advisor at Homewise, talk to them about your plan for your tax refund.