Sunday, January 22, 2012

Tax Time Tips...

So, I figured I'd go ahead and post a tip and not just a welcome message.

Since tax season is here, I thought I'd go ahead and create a post on it....

If you are fortunate enough to get a tax return from Uncle Sam, a lot of people who have debt will usually jump right in to paying off debt such as credit cards, loans, ect. This is not bad, however if you do not have a savings account with more than just a few dollars in it,you need to try and fully fund yourself an emergency fund.

Dave Ramsey says you should have $1,000, Joseph Sangl says $2,500 I would say if you can do $2,500 do it!, if all you can do is somewhere between those two figures then do that. Here is the reasoning for that. So many times people rush to pay off debt with their tax return, like I stated earlier this isn't bad, but what happens if you have an emergency that you are not prepared for?, such as a car breaking down, or a water line freezing and you have to hire a plumber, or your refrigerator goes out...these things usually put right back into financing the emergency and we are back where we started. If you fund yourself an safety net such as an emergency fund, and then when this happens not only can you negotiate the cost of the emergency because you can pay cash (sometimes, depending on the emergency), but you don't have to worry about getting approved to finance the emergency. You can live a little easier when you know you've got that safety net....just be disciplined and DON'T spend it!

Also, generally when you just pay off the debt, you will free up X-amount of dollars per month. This is nice however we tend to just spend it anyway vs. saving those extra dollars.

Thanks for reading!!


  1. So glad you are doing this! I'll send you all my tips to get out there! We went from a combined $80-90,000/year income to about $60,000 last year. And, guess what...we are still working on becoming debt free, we still have an emergency fund, did not draw out of our retirement accounts, and our kids still had an awesome Christmas:) It's definitely a life changing experience!

  2. Hi! I am interested in opening an ING orange account. Will you please give me your referral info? My email is
    Thanks for such awesome tips! -Lorie