It’s tax time and according to CNN Money nearly 8 in 10 US tax filers will receive a refund this year. If you are one of these people, you may be wondering, “How should I use my refund?”  I have heard so many stories of people who had been delaying a repair or the purchase of a need during the year, but when they get their tax money they splurge on a want.   When that happens that major repair or need doesn’t get addressed. I know others who have no savings or high credit card debt, but instead of using some of the tax refund to increase their savings or reduce their credit card debt, they spend their refund on new clothes, shoes, or a fabulous vacation only to remain in the same place financially.


Don’t worry I’m not going to tell you that you have to spend all of your tax money taking care of your financial obligations, but I am going to give you two strategies that will allow you to address your financial obligations, improve your financial health, and still leave room for fun.

Strategy 1: Re-examine your goals. Before you get your tax refund this year, go back and review the goals that you set at the beginning of the year. Look at what you wanted to accomplish in your financial life and how that would make you feel if you accomplished that goal. Understanding that goal will help you to stay focused and not spend your entire refund check on something that isn’t aligned with your goals or values. I have a friend of mine who set a goal at the beginning of the year for when she wanted to walk away from her full time job to become an entrepreneur. She wanted to pay off the rest of her student loans before she left her job, so when she got her tax refund she used it to pay off her student loans. Because she understood her goals, she was able to use that as a guide to how she spent her refund.

Strategy 2: Determine the rules for spending your tax refund before you receive your refund. My recommendation is to divide your tax refund so that you can accomplish your financial priorities and still have fun. Last year when I got my refund, I took 10% off of the top to tithe and then I divided the remaining 90% into thirds. I used my first third to increase my savings.  I used the second third to retire debt, and the remaining third on a guilt free splurge. This allowed me to allocate my money where I needed it the most and I allowed me to splurge on what I wanted to most at that time.

This allocation may look different for you. I’ve been using the divide into thirds strategy for years, because I really like that I can narrow down my spending to the top 2 major financial priorities and then still have a nice amount left over to play. I have even used this strategy for work bonuses as well. Your top two financial priorities may look different than mine. You may need to get a car or a home repair, make a major purchase, increase your giving, or invest in your business. However, the message is the same – use the money to improve your financial health but take time to enjoy it as well.

I hope that this provides you some guidance and relief that you don’t have to spend it all on necessities, but there is a way to spend on you as well. Leave a comment to let me know how it goes!

Aisha Taylor is a #1 Amazon Best Selling Author of the book “5+5 FNPhenomenal Ways to Save $100 This Week Without Killing Your Lifestyle”, the Founder of FNPhenomenal (Frugal –n- Phenomenal), and creator of The Live Phenomenal ProgramThe Live Phenomenal Program is a program designed to give you the tools that you need to totally transform your finances, and stop living from paycheck-to-paycheck. It’s time for you to be Financially Phenomenal!  Join now at

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