The average tax refund in 2014 was $2,696. Did you know that about eight out of every ten tax returns filed in 2013 got a refund? If you're one of the lucky eight, before you run out and blow the money, consider these six ideas for smart ways to use your money.
Use it to make a Roth IRA or traditional IRA contribution for 2015. The 2015 IRA maximum is $5,500. If you are age 50 or over you can contribute an additional $1,000. If your refund is the 2013 average of $2,696, you're halfway there. Life is expensive and retirement will be more expensive. Start saving yesterday!
Start or add to an emergency fund. A robust emergency fund is your financial security blanket. You'll sleep better at night with the peace of mind that if the water heater goes out or you have an expensive car repair, you've got the cash to pay for it.
Pay off credit card or consumer debt. Still got some Christmas bills hanging around? You're probably paying 15% to 20% interest. Pay them off.