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Smart Ways to Spend Your Tax Refund
FEBRUARY 17, 2013 About 75% of taxpayers are expected to receive refunds this year, according to estimates from the Internal Revenue Service, with the average check coming out to about $3,000. And as this winter windfall arrives, Americans wrestle with competing desires to spend, save, or invest the cash.
Rebalance your portfolio: With the stock market hovering near five-year highs, advisers normally would recommend investors rebalance their portfolios by selling stocks and using the proceeds to buy bonds or whatever assets they need to get back to their target allocations.
Prepay your bills:Even if you’re not living paycheck to paycheck and could afford to spend your refund on a new iPad without falling behind on your bills, there may be better uses for the cash. Though it’s not nearly as exciting, one can use the money to pay off future bills, says Jon Beyrer, a financial planner in San Diego with Blankinship & Foster. “Why not use this money to put yourself ahead of the game?” says Beyrer.Read more: Yahoo Finance