What can you do to Make and Save More Money with your Tax Return?
The end of the financial year is almost here, which for many Australian families means they’ll soon have a tax return or a lump sum payment from Centrelink they can use.
If you don’t have a plan for the money it can easily be frittered away or wasted. However, if you want to make sure your tax return works harder for you, here are some options.
This post may contain affiliate links to products and services we use. Check out our full disclosure here.
Switch to Annual Insurance
Paying your insurance monthly? You’re probably paying more a year by doing this.
With your tax return, you could now compare insurance premiums, pick the best one for you and switch to annual payments.
Continue putting aside your monthly premium amount into a high-interest savings account and use it next year to pay for your insurance.
This way, you get the lower rate by paying annually and next year you’ll have the money when you need it, rather than relying on your tax return, leaving your return available for something else if you want.
Check out more tips on saving with insurance here.
Reduce Your Debt
Debt is a massive burden to carry. The interest you pay, the amount of money from your wage which has to go to debt and the stress it causes are all awful.
Put your return towards debt and get financially free sooner. Even if the amount doesn’t totally clear a debt I bet it’ll get you a lot closer!
As you clear your debts, close the accounts so you can’t rack up the debt again later. Check out 6 tips to easily reduce debt.
Everyone needs a mini emergency fund. $1,000 to $2,000 is recommended as this amount will usually cover any emergency such as car repairs, your insurance premium if something happens, medical etc.
Keep this money in a separate account so you don’t touch it and only use it for real emergencies. Look for a high interest savings account to earn a small amount of interest on this amount.
Invest for the Future or in Yourself
It’s best to speak with a financial planner when it comes to your finances and investing. However, if you want to get started with a small amount, you can do your own research and invest as you wish.
There are numerous platforms through which you can invest in shares. Do your research, check all the fees, read reviews and be smart about it. Get professional advice if necessary.
Invest In Yourself
Lastly, you could invest in yourself by doing a course, taking a class you’ve always wanted to or getting something you need but have put off such as dental work. Any of these are a wise investment in yourself.
I enrolled myself in a Diploma of Counseling one year and did a few courses on Udemy for as little as $15.
Signing up for Audible made it easy to listen to books, otherwise purchasing books (on sale) has gone a long way to improving my life and the lives of my kids. Check out all the books I read one year.
Joining a gym, doing a dance class or other class you have always wanted would be a great way to invest in yourself and your health.
Getting health insurance can be useful, especially if you know you are going to be earning more and will need the tax benefits or you know you will need private healthcare in the future.
Therapy is another that many feel they cannot afford. Using a ta return to pay for some, along with a mental health plan and a therapist who does a special rate for low incomes can mean you get some much needed mental health help.
Eventually, you will need to replace items in your home. Research has shown the difference between old appliances and new ones when it comes to energy efficiency, especially for things such as heating and air conditioning.
A new split-system air conditioner might cost a little upfront, but the savings on your bills can be huge! Is your fridge or washing machine on its way out? Start researching now for the best deals now.
Add To Your Super
Compound interest is your friend when it comes to superannuation. The sooner you put money in, the longer it has to earn interest and grow then earn interest on that interest.
Plus, depending on your income, there are co-contributions and other tax benefits for the following year if you deposit into your superannuation.
Your Mortgage or Home Repairs
Sit your tax return in your offset account to reduce the interest you pay and clear your mortgage quicker. Alternatively, you could do some repairs or renovations to increase the value of your home then look at refinancing to get a better rate and save even more.
Money Savers for Renters
If you rent you might want to invest a little of the money you have in things that will save you money. Foam tape from Bunnings to seal gaps around doors can prevent heat being lost and help reduce your electricity bills.
As can draught stoppers for the bottom of your doors. Clothing racks to dry clothes instead of using the dryer, dryer balls for when you do use the dryer, a lamp to light a room instead of using multiple downlights etc.
Look at where there are things that can be easily fixed or adjusted to save money on your power bills.
Personally, I view travel as a valuable investment in living your life and when done with the family, it is great for relationships, bonding and creating memories.
You don’t need to travel far to have a good time either. A camping trip at a free campsite or national park can be an incredible experience.
My kids have fond memories of many free camping trips we’ve done. Camping gear can be sourced cheaply on Facebook Marketplace or through sales.
Start A Stockpile
Buying items when they’re on sale so you never pay full price is just one of the many reasons people stockpile. At this time of the year, there can be incredible deals that you can cash in on.
Compare prices and see if buying things in bulk or on sale can save you money on your groceries.
You might also want to check out how to reduce your groceries costs now and tips for reducing waste/ideas for using up leftovers.
Start A Business
Have you always wanted to start a business but didn’t have the funds to kick it into gear? You can now! Check out this post for how to start a business with less than $100.
If you want to get into blogging, check out how to make money blogging here including the host I use and what I do.
When it comes to business, I highly recommend reading and implementing Profit First to ensure your finances are managed well.
The quality of our sleep impacts every part of our lives. You might want to consider using your taxx return to improve your quality of sleep.
A new mattress can make a world of difference. We spend so much of our time asleep or in bed that it is worth getting a good quality mattress.
New pillows, nice linen, an eye mask and doing what you can to make your bedroom relaxing, comfortable and your ideal place to sleep.
I already mentioned health insurance, the gym and therapy. What are things you have been putting off when it comes to your health that you could do with this lump sum?
Dental work is one example that can lead to significant health issues. Get a general checkup so you know what you need to do.
When was the last time you have a full medical check up? Knowing how our bodies are working, anything we might be deficient in and what our baselines are will help in the future should anything need to be addressed.
Think about any health matters you could invest in to improve your quality of life.