7 Better Ways To Use Your Tax Refund

Are you expecting a tax refund soon? If you’re like most Americans, you’re probably expecting somewhere around $3,000 to show up in your mailbox over the next months. Receiving a refund check has become a strangely normal piece of financial planning for Americans – we count on receiving that extra cash and plan to spend it.

But your refund check is just your own money going back into your pocket. I recommend you adjust your withholdings for the next tax year so you can have more money in your hands every month instead of lending it to the government interest-free all year. And if you are planning to receive a refund this year, here are 7 better ways to use it!

1. Save.

Did you know that 70% of Americans don’t have $1,000 saved? In fact, six out of 10 Americans couldn’t even access $500 in an emergency. And 34% of Americans said they don’t have any savings…at all.

Saving is not only critical to getting out of debt and building a stable financial future, but it’s also an essential part of stewardship. Saving does not represent a lack of faith, it reflects the heart of a faithful steward. Planning to care for your family, disciplining yourself to create financial margin, and balancing your savings are all opportunities to honor God and experience His blessings.

We recommend you make your first savings goal $1,000; then work your way to 3 months’ worth of your living expenses; then 6 months’, and finally 12 (you can track all these goals on Crown’s Money Map). If you’re working to reach any of these savings goals, commit to depositing your refund check directly into your savings account. According to a survey, 43% of Americans are planning to do so!

2. Pay Off Debt.

Barely second, 42% of Americans are planning to use their refund to pay off debt. As Proverbs says, the borrower is slave to the lender, so using your refund to pay off debt can help you break the chains of financial bondage and debt.

If you’re specifically dealing with credit card debt too large to be paid off by your refund check, I want you to get in touch with our partners at Christian Credit Counselors. They specialize in helping people pay off their overwhelming credit card debt and can walk you through the process of becoming debt-free.

We also have debt-help resources available for you to create an efficient payoff plan. Go through the 5 Steps to Debt-Free Living video course (it’s free) to get access.

3. Give.

Giving is a material expression of our spiritual obedience to Christ. It’s our way of acknowledging that God is the owner and provider of all we have and that we are His stewards. It’s described in the Bible as a practice that will bring overwhelming blessings and gifts to our lives. Yet we are out of practice and undisciplined when it comes to obeying the Scripture.

Jesus said, “It’s more blessed to give than to receive.” (Acts 20:35)

He also said, “Give, and it will be given to you. A good measure, pressed down, shaken together and running over, will be poured into your lap. For with the measure you use, it will be measured to you.” (Luke 6:38)

Giving requires an emotional sacrifice of forfeiting ownership. It propels us into a freedom found in exercising faith, by believing God will use our gift and supply our need. Be sacrificial and commit your refund check to your church or a reputable ministry that has impacted your life.

4. Build a Nest Egg.

Not saving enough for retirement soon enough is the number one regret of older Americans. As more and more people realize that their dreams of a Floridian retirement are decades of saving short, remember that you are saving to be used by God, not to live a life of leisure.

A detailed, disciplined retirement savings plan is important to have financial freedom. Research what kind of retirement account and investing strategy best suits your age, family, career, and future needs and then be disciplined to save. Adding your entire refund check to your nest egg will help ensure a stable financial future for you and your family so you will be free to be used by God.

5. Invest.

If you have at least 3-6 months of your living expenses saved, no debt, a habit of disciplined and generous giving, and a growing retirement account, then consider using your refund check to invest.

The Bible does not condemn investing and Christians should see it as an opportunity to increase their impact for the Kingdom. The stock market’s volatility this year has been in recent headlines, so be cautious and patient to do your research and seek wise counsel. With the right strategy and patient timing, a $3,000 refund check could yield you much greater returns later.

6. Prepay Your Mortgage.

Avoid wasting money on interest on your home’s principal by using your tax refund to prepay your mortgage. Throw a portion of or your entire refund check directly towards your principal balance on your house and shave months off of your loan! (Be sure to specify that you want to pay towards your principal when you make the deposit. Otherwise, a large portion could still go to interest payments.)

7. Spend to Save.

There are some things that you should spend money on to save money. For example, my wife and I are diligent about keeping our cars well-maintained and routinely spend money to rotate our tires, change our oil on time, and care for our vehicles.

Take care of your home, your vehicles, and your appliances by using your refund check to pay for updates and maintenance. It may not be an exciting use of your money, but it will pay off in the long run.

By Chuck Bentley, Crown Financial Ministries

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Investing, Money Management

Investing 101

You and Your Investments

Maybe you have asked yourself, “How do I start investing?”  It’s very simple, but before you start, make sure you have your house, budget, and savings in order.  There are many things you can invest in: stocks, bonds, mutual funds and real estate, to name a few.


One type of investment can be in the form of a bond.  Many refer to it as a “Fancy IOU.”  This is when you lend out your money and in return you gain interest on it.  However, the return may be very small.  Bonds have predetermined intervals of when they pay interest which usually occurs semi-annually.  The maturity date on a bond refers to the end date of the agreement between the lender and the buyer.  Also, it is important that you know that interest rates and bond prices have an inverse relationship.  As interest rates fall, the price of the bond increases and vice versa.


Stocks are another type of investment and the way people make a profit is when they increase in value.   When you own stocks in a company like Coca Cola, it means you own part of the company.  The concern with stocks is that the value fluctuates on a daily basis.  Stocks can have a high return, but the loss can also be very high.  To safely invest in stocks, invest in a company that will be around for a long time, for example, Pepsi Co, Apple, etc.

Mutual Bonds

Mutual bonds provide more of a safety net than regular bonds and stocks because you are not putting all your eggs in one basket.  Putting together money from many investors and purchasing stocks, bonds, etc., form a mutual bond and another person manages them.  Having the money professionally managed is a positive for many because it adds a level of security.

Researching Investments

With investing there are no guarantees but with the proper research you will be investing your money in a safer outlet with a higher chance of gaining profit. Regardless of what you choose to invest in, check the track record and know what you are getting into.

If you are still doubtful about investing, think of the money you set aside for savings that is not accumulating any interest, meaning you aren’t making any extra money. In fact, you are losing money at the current inflation rate if you do not invest at a higher interest rate, so use this as motivation to start growing your money!

Do you want to know more about debt and how you can make smart financial decisions now that will help you secure a more prosperous financial future? Sign up for our newsletter for monthly money tips.

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    Investing 101

    Saving and Investing

    The difference between saving and investing is that when you invest, you put money in hoping to get something better back out. Every contribution is a step towards the goal of having the kind of retirement you want. Here are some of the most common choices:

    Stocks—these are shares of ownership that a company sells to individuals to raise the money it needs to conduct business. The value of the shares usually rises and falls over time, depending on how the company is doing. However, there is potential for high long-term growth. Stocks have the highest risk and return potential.

    Bonds—these represent loans to a company or government to finance operations. The loan is paid back after a fixed number of years and the investor receives regular interest payments. Typically, the risk is lower than that of stocks, but may not earn as much in the long run. Bonds have moderate risk and return potential.

    Mutual Funds—these are professionally managed funds where your money is combined with money from other investors to invest in a variety of stocks and bonds. This is a good way for smaller investors to gain diversity of their investments. The risk level depends on the stock and bonds in which the mutual fund invests.

    Cash Investments—these are the most basic type of investments but produce the lowest returns. Types include bank and savings accounts, money market mutual funds, certificates of deposit, and treasury bills.

    As always, investments don’t come without risk, but if you’re investing for the long term and start early, you’ll have more time to ride the ups and downs in the market. Whatever you do, choose the investments that are right for you.

    Do you want to know more about debt and how you can make smart financial decisions now that will help you secure a more prosperous financial future? Sign up for our newsletter for monthly money tips.

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