It’s tempting to treat yourself with your tax refund but there are more productive ways to use this money that will benefit your finances over the long run. Kim Parlee of TD Wealth explains.
So why not treat yourself?
Buy that new TV or book that vacation, right?
Well, not so fast.
Splurging may feel good now, but remember, this is not a windfall.
It's your hard earned money you overpaid in taxes last year.
So if you'd rather see this money grow instead of spending it, here are some ideas to put your tax refund to work.
If you have credit card debt, pay it down.
Get a head start on next year's contribution in RSP or TFSA and let compound interest work its magic.
And if you own a home, make an extra mortgage payment.
You might think making an extra payment once makes only a tiny dent in your mortgage, but paying down your mortgage with your tax refund every single year could make a huge difference over time.