Tax season can be exciting when you know you are getting a refund for your military family. Having a little bit of extra money means you’ve got options to do things that are not currently built into your budget. Beyond simply splurging on luxuries you can’t afford, consider stretching that windfall out so it lasts well beyond tax season. Military families face challenges of frequent moves, being far away from family, childcare accessibility, milspouse work security, and the list goes on. So, before you hit “Buy” on something extra, consider how you might use this year’s refund to alleviate an existing financial burden, set your family up for future success, and make your military life a little easier.
1. Pay Off Debt
Paying off a debt you owe may not be the most exciting or glamorous way to use your tax refund, but it can help alleviate the stress of worrying about unpaid bills. Unexpected expenses can come up quickly and put you behind on credit card payments. Continuously using a high percentage of your available credit or carrying a lingering credit card balance is not only stressful but can actually impact your credit score or ability to secure new credit when you really need it. Before you have to take out a loan to make ends meet, prioritize the funds from your tax refund to pay off or pay down your debt. Getting out of debt is one of the best ways to get ahead in your finances. It may not be a fun way to use the extra cash, but it will greatly benefit your family’s financial health.
2. Do Something Special as a Family
Even if you are using most of your tax refund to pay off debt, you could use a little of your extra money to do something special with your family. Maybe it’s dinner out at a favorite restaurant or something bigger, like a family trip to the local zoo, museum, or another fun experience in your local area. Doing something together to celebrate your current duty station or giving the kids an experience they’ve been longing for is a great way to treat yourself and your family.
3. Prepare for Your Next Move
Military families experience the challenge of moving away from family and friends on a regular basis. A PCS move can strain your budget if you aren’t prepared. Trips back home to see family can add up quickly. You know a permanent change of station order is inevitable. Saving your tax refund to prepare for your next PCS will help make those orders less financially stressful when they do come.
4. Save and Invest
Saving your money is the foundation of financial security - for now and into the future. Consider using your tax return to jumpstart your savings, contribute to your kids’ college funds, or invest the money to help prepare for retirement. Always consult a trusted financial advisor before making any investment decisions to ensure they align well with your family’s goals.