Investing tax refunds in yourself and your family can be a wise financial decision


By Aaron Allen, The Seattle Medium

It’s tax season, or what many Americans might call “tax refund” season. It’s a time of year when many people plan what to do with their tax refund, if they’re lucky enough to receive one.

Some people worry about tax season because they have a lot of financial information to gather and hope that the person preparing their tax return can help them identify deductions they didn’t know they were eligible for. . Yet there are others who are eager to file their tax returns online or rush to their tax preparer’s office in anticipation of how much money they will “recover this year.”

For most people, seeing their account balance go up when they receive a tax refund is pretty nice. However, according to many financial advisors, “that ‘extra money’ isn’t free money – it’s earned money that you overpaid to the IRS.” In some cases, it may be a large cash lump sum relative to your income. A tax refund, if used strategically, can be a solid addition to your retirement plan, seed money for a dream vacation, and even an investment in the future of your children or grandchildren. .

“Everything we discuss, when we talk about his financial future, involves a level of planning,” says Eli Taylor of JPMorgan Chase’s wealth management team. “No matter where you are on the financial spectrum, I strongly encourage people to sit down and discuss their interests and future interests with an advisor.”

“In advising clients, I like to suggest three smart investment moves,” says Taylor. “For educational purposes, the 529 plan is an investment account that provides tax advantages when used to pay eligible educational expenses. Another is the emergency savings account and finally, a health savings account. All of this can help you grow your financial savings.

“Families can target each of these goals simultaneously,” Taylor added. “Depending on the client’s situation, it might be more beneficial to have a plan to eliminate high-interest debt first, then redirect those funds to the emergency savings account and the 529 plan.”

Our financial health throughout our lives evolves in ebb and flow. It evolves as we evolve, it can even weaken, when we weaken. Through a number of initiatives, Chase can help provide people with the knowledge and resources to help build a financial foundation for their future.

“Your financial plans are a living, breathing, evolving document,” says Taylor. “It’s never too late to take a holistic planning approach to your finances.

Taylor believes that the connection between wishing, planning, and successfully executing one’s financial goals and objectives is very important when it comes to seriously considering one’s long-term financial goals. Instead of focusing on what they want to do now, it’s just as important to focus on the future. One way to do this is to learn how important your tax refund can be, the role it can play in planning, the versatility in how those funds can be used, and at what point planning can be fun when you learn how your money can work for you. and your family.

“Holistic planning is adaptable and can be applied to unique situations,” says Taylor. “It’s not a one-size-fits-all plan. Your plan is designed and made for you. The key is to get started, every penny is worth it and that includes your tax refund.

One thing that many financial advisors agree on is that it’s always a good idea to have some money set aside for retirement. Whether you’re putting money into a savings account or investing in a 401(k) plan or IRA, the amount of money you can set aside today will influence your lifestyle after you retire. .

“401(k) plans and IRAs are two types of retirement vehicles,” Taylor explains. “A 401(k) is a type of employer retirement account, and an IRA is an individual retirement account. The investment objective of these plans will be unique to the individual taking into account factors such as their tolerance risk and its time horizon.

“Typically, someone just starting out in their career who is in the accumulation phase of retirement savings will have a greater tolerance for volatility due to their longer time horizon, compared to someone approaching retirement, which could be more conservative and focused on asset preservation,” Taylor continued. “I encourage anyone with questions about retirement planning to speak with an advisor.”

Ultimately, the concept of financial literacy and planning is about ensuring a financial legacy for you and your family. If you plan ahead, chances are you’ll reduce any financial burdens you may have in the future. You may be able to take a dream vacation, buy a vacation home, help your child or grandchild pay for their education, or help them buy their first home. Many things people dream of are possible as long as they have realistic goals and a realistic plan to achieve them.

“Planning is about determining which goals are most important to you,” says Taylor. “As an advisor, I am able to accompany my client to help them develop a plan that corresponds to the desired results. Life is full of surprises and ups and downs, but a good plan can help keep things on track.

Learning about the best ways to use our tax refund can be a great way to kick-start your financial plan for the future. Using it in a variety of ways with the ability to transition, a tax refund can provide you with the means to move forward with your savings goals.

More importantly, starting early, educating your kids, and giving them a head start on financial literacy should also be considered. Legacy is one of the main reasons we save, our future is our children and the youth in our community. It’s important to us to lead by example and teach them how to plan and execute a financial plan to achieve their long-term financial goals.

“It’s never too early for parents to start introducing good financial principles to their children,” Taylor says. “In fact, parents who are Chase Checking customers have access to Chase First banking services. These are parent-owned accounts for children ages 6-17. Personally, I have a six-year-old and a 10-year-old. Both children have Chase First bank accounts that my wife and I use to teach them the benefits of saving and budgeting.

For more information on savings accounts, retirement accounts and financial planning, please visit a local Chase branch or visit them online at


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