Don’t waste your tax refund
“What are you planning on doing with your tax refund?” asks financial advisor Zaino. “If you’re like most Americans, the world of instant gratification is beckoning. It could be extremely damaging to your retirement account, however, especially given the time value of money and what some people call ‘the eighth wonder of the world”—compound interest”.
“Based on last year’s data, the average refund should be about $2,800. Let’s say you save your money in a vehicle that earns you 6 percent annual interest and you have the discipline to continue to deposit $2,800 every year for the next 30 years. That would yield $250,726. At 7 percent, you’d have $304,319. That’s an EXTRA quarter-million dollars in YOUR retirement account—just for being disciplined and not blowing your refund.” Read also 8 Smart Ideas on How to Make the Most of Your Tax Refund.
Never co-sign a loan
“Co-signing a loan isn’t just vouching for someone’s character,” explains Toomey. “Understand that if the borrower doesn’t pay, then you’re responsible for every single missed payment. If they don’t pay, it’s your credit that will be ruined.”
