How to make the most of your tax refund check, 7 On Your Side shares top tips

NEW YORK (WABC) -- We're just one week away from the extended deadline to file your taxes and if you filed early the IRS says it's working through a backlog of about 1.5 million returns.

They're turning around refunds in about six to eight weeks.
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But what do you do with that check when you get it?

The average tax refund is about $3,200.

If you took $1,200 of that and invested in the stock market growing at 6% a year, you'll have a $60,000 nest egg in 25 years.

ALSO READ: Financial tips for women by 7 On Your Side

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Other ways to grow your refund money - park some in a high yield savings account, many new online banks, credit unions, and non-bank providers offer much bigger annual yields than traditional savings. Look for accounts that have high-interest rates and low fees.

You could also divert a chunk of your check directly into your 401K and boost your retirement funds.



Next, get out your wallet and pay down your most expensive credit card, the one keeping you in a circle of debt with that sky-high interest rate. If you're carrying plastic that charges 20% or more in interest, it is time to ditch it.

Another good use is to deposit your refund in an emergency fund. It's a safety net in case the boiler breaks down or a partner takes an income hit. Set a goal to save at least three to six months of living expenses just in case.

How about some tax refund treats for yourself?
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Invest in YOU! Maybe a professional course online to boost up a resume or learn a skill like writing, cooking, or other avenues of self-improvement.

Or, invest in your biggest asset, your home. You could complete a repair you've been ignoring like a new roof, or energy-saving measure which will help with your bills like a smart thermometer or security system.

ALSO READ: 7 On Your Side helps get Con Ed to pay for woman's car repair


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