My tax refund is here! Wahoo! This tax refund is not as impressive as the ones I’ve received in the past, because I’m sadly out of tuition tax credits this year. My days of mondo tax returns are over. (*tear).
That said, I’m still super duper pumped to be getting a lump sum of cash deposited into my account! I love tax returns because they keep me motivated and excited about my financial goals, they break through the monotony of the hum drum get-paid-deposit-into-savings routine that is my financial life right now.
I’m Getting More Responsible With My Tax Returns
Back when I used to be less interested in money, I would fantasize about all of the different things I could do with my tax return. I almost always spent my tax returns. When I turned 21 I spent my return on a trip to Vegas (no regrets on that one). When I first started the blog, I resisted the urge to spend all of my tax return, I put the majority of it on my debt and kept a little bit to finance the purchase of our SPCA mutt Molly (also no regrets), then last year I finally manned up and took every last cent and applied it to my debt.
Previous uses of my tax return – visiting the lions at the MGM and adopting a dog.
If I was going to blow this money on anything, it would definitely be on a new couch set. My husband and I are currently rocking a free couch and a slightly funky smelling love seat we found in the basement of our three bedroom rental. Neither of them really meet my needs, and if I had the money, I’d buy this awesome pull out couch from IKEA:
One of my friends has one and I’ve spent a few nights crashing on it, it’s really comfy and affordable!
Financial Comfort is More Important Than Actual Comfort
That said, I’d way rather have a fully funded emergency fund over a new couch, and I’m willing to put up with my mismatched and slightly uncomfortable furniture a little bit longer in the name of financial security. Instead of spending the money on a trip or new furniture, I’ll be shovelling it into my emergency fund, bringing the grand total in that account to:
$5,877.92
That’s more than double the highest amount I ever had in my emergency fund when I was paying off debt and it’s by far the most cash I’ve ever had on hand in my lifetime. I’ve increased my emergency fund by 125% since January and I’m so, so happy to finally start seeing some results from my dutiful saving efforts.
THIS is why I wanted to pay off my debt in the first place. Being debt free is great and all, but just being debt free means I was at zero. I was on the edge of the hole I’d just dug myself out of, and I felt like I could fall back into it at any moment. Now, I feel like there is some distance between me and that hole. I feel like I finally have a buffer, like it would take more than just one ill-timed emergency to throw my life back into chaos.
To Infinity, and Beyond!
I should have over $6k in my emergency fund by the end of March, and I intend to have over $9,700 in my emergency fund by the end of April (you can read about how I plan on achieving this, here), but that doesn’t mean I’m going to stop squirrelling away money any time soon. Once my 10k emergency fund goal is reached it’ll be time to start saving for the many trips I plan to take in 2014. So much to do, so little time! Good thing I have this tax return to help boost my savings.
What are you planning on doing with your tax return this year?