I'm in the happy situation of getting a tax refund of about $3000 but can't figure out the best way to use it. I'm normally really on top of our finances but BFing has turned me into a mushy brained nitwit so i turn to the boards for some perspective. In my situation WWYD?
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All extra money that DH and I have we are putting it towards bills, No extra spending going on here!
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It depends on how much cc debt you have, and the interest rate!
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Agree with Mr Bee. But I say either the credit card bill or saving it to cover expenses during mat leave, since if you don't save that, it sounds like you would incur more credit card debt.
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Credit card debt! Unless you have $0 savings.
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I think it depends on your comfort level with CC debt. It would literally keep me up at night - so I'd put 100% towards debt. But if you're more rational than I am, I'd split between CC and savings.
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I'm in a very similar situation, and I'd send that bonus to my CC so that I wouldn't be wasting money on interest fees for no reason. And that would free up my regular paycheck a bit so that I could put more into my maternity savings stockpile.
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I agree with mr bee as well. Or use it to pay for maternity leave expenses, then save some.
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I vote for paying off credit card debt... and then the rest I'd probably put away into savings.
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I would pay off cc debt. Living without cc debt is so liberating! I love it
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I voted cc debt!
We will probably get about 1-2k refund and I think we're going to splurge on a new couch. We've never had a new couch and the ones we have are pretty sad. They give me back pain!
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The CC debt is about $3k but 2k is 0% interest until next year, the remainder is about 15%.
Normally I would pay back any debts but a we have a large (by London, not US, standards!) new house and I'm concerned that we need a fair amount of cash for an 'emergency fund'
Appreciate all the input!
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Pay of CC debit, that is our goal, so any extra money goes there, it is the black cloud over our head!
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I'm going to slightly disagree with everybody. I'd totally put some of it towards debt, be it morgage or cc debt, and some in savings. But I'd also splurge a little. Maybe take $200 or so and get something fun for you and the Mr.
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Wow, a $3K refund sounds absolutely heavenly!! We owed $5K this year and it was a major downer
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I would pay off the portion of your CC debt that is at 15% and then put the rest into savings. If you aren't able to pay of the rest of the CC debt through your income by the time the 0% runs out, then you will still have the 2K in savings and you can reevaluate at that time.
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I always like to split extra money -- something like a 40/40/20 split. So 40 toward debt, 40 toward savings, 20 toward something fun or something we've been wanting to buy for the baby or around the house. It makes me feel productive but also gives me a little treat.
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1,000 to credit card debt (the 15% interest stuff) and 1,500 to your savings and 500 to splurge/ spend during maternity leave! I always split up bonuses, refunds to different things because it feels like its going farther
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I'd pay off CC debt.
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i'd pay off the cc debt first. and then start putting money into the emergency fund - ideally the monthly payments that was going towards the cc debt. but maybe splurge alittle bit on a nice dinner or something like that!
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19 comments