How Entrepreneurs Should Use Their Tax Refund
Updated: Sep 21, 2020
It’s that time of year again...TAXES! That’s right, it’s tax filing time again and while some people will be paying taxes, others will be receiving some back.
If you’re on the receiving end during tax time, this one's for you. We’ve put together a list of some ideas for all you entrepreneurs out there to spend your money on. Take a look to see how you can utilize the funds Uncle Sam has given you:
Pay Down Debt
In America, debt is in the trillions. As individuals, we make up that debt with car loans, home loans, student loans, credit cards and more. We can’t control the masses; however, we can control our own finances and get ourselves to as minimal debts as possible. One way to get ahead on this is by paying a little extra on our debt. If you are an entrepreneur who has to take out a loan for your business, it may be a good idea to pay down on that loan. If you get a lump sum of money at the beginning of the year, what better time than now to use some of it toward debts owed.
Saving money for a rainy day is important. You never know when you may need it. The unexpected happens, so you always want to have some "just in case" money. Unexpected expenses could include auto repair, unplanned travel, or health expenses and these aren’t usually cheap. Not only should you save for unexpected expenses, but also for your future self and business. Business can change in a flash and you may never know what new expense might come along the way, so it's best to be prepared. There may be new software or new machines you need to purchase, new employees or business partners to pay, or maybe even an expert for your business. The saying “it's better to have more than not enough” applies to money as well. You don’t want your business to fail due to a lack of money. Sadly, many businesses fail this way.
Invest in Your Business
This one should come as a no brainer for entrepreneurs. You should always invest in your business. Whatever your business may be, make sure your consumers receive top-level services or products. Invest in your team - make sure the people you work with are good investments as well; after all, they can help lift your business or bring it down. Other ways to invest in your business could include paying for assets your business needs, such as marketing, analytics or SEO. And don’t forget about your workspace! Updated equipment and software is a MUST in our forever growing economy.
Pay Bills in Advance
What would feel greater than not having to worry about bills coming in back to back each month? There are many bills that can be paid in advance. Some include rent, utility bills such as water, electricity, and gas, cable and internet, cell phone bills and car insurance. If you’re running a business, how about paying some utility bills for the office or paying the rent fee for it? One less worry for you, right?
Last, but definitely not least, don’t forget to treat yourself. At the end of the day, your life, nor your business can be run without YOU! You have to take care of yourself. Treating yourself could look like a vacation to a place you’ve always wanted to go to, or even a staycation to do things that make you happy. If you are a woman who loves a little glam, go get your nails or hair done. If you are a man in the need of some freshening up, go get a haircut or a pedicure (yes, men get these too!). Take yourself to the spa, go out to a fancy restaurant or go shopping! You deserve to treat yourself, so don’t feel guilty for doing so.
The bottom line is, getting a tax refund could be a great way to get ahead, get out of debt, help your business or just give you a boost in general. If you are an aspiring entrepreneur or already one, choose wisely what you want to do with your money. Have any tips to add? Let us know on Instagram at @thisisuproar.