Whether they’re buttoned, fastened with Velcro, or zipped, your pockets will not be able to escape the fact that it’s that time of year again when thousands of everyday New Zealanders receive their tax refunds for the 2011 tax year. Instantly pockets up and down the country will start to smoulder, after a day or two small holes will start to appear and before long the entire pocket will disappear!
With this being such a testing time for New Zealanders (and pockets!) I thought I would provide seven inspirational ideas as to what you could do with your tax refund. As you know everybody’s refund amount is different based on their personal circumstances, however the suggestions below are based on the average amount NZ Tax Refunds clients have overpaid their tax by, which is $450.
Nothing! – OK I admit it’s hardly inspirational, but it sets the scene, if you did like the burning feeling in your pockets and kept your tax refund as cash, in a year’s time your $450 refund would actually only be worth $439 due to the depreciation of money and the inflation rate (based on 2010 inflation).
Save for a rainy day – (and we have a few on their way!): Too many other things to think about at the moment, then pop the tax refund into your bank account. If your account has a healthy interest rate of 3% per annum in 365 days you would have ‘earned’ a jaw dropping $13.50 (approximately) – it will help overcome the depreciation of cash, but live off the interest? I’m afraid not.NZTaxRefunds Credit Card
Pay off credit cards – Like any love hate relationship we don’t always like talking about them. However if your credit cards, particularly ones with high interest rates, have been hit recently and you have outstanding balances on them, then it makes financial sense to use your tax refund to pay off the debt and maybe transfer your card to one with a lower interest rate.
Think big – It’s not the most responsible investment option we could offer, and NZ Tax Refunds Ltd does not endorse gambling in any way, but by investing your tax refund into the NZ Lotteries Powerball game you would increase your chances of winning!
For every play of Powerball you have 1 in 38,383,800 chance of winning the jackpot. For comparison the odds of being struck by lightning is only 1 in 700,000! However if you invested $450 into the NZ lottery Powerball your odds of winning would increase to 750 in 38,383,800. However with the odds of winning a prize at 1 in 363 you should in theory at least win twice, we predict around $50.
The luxury present – Don’t feel guilty; after what you’ve been through you deserve a little treat! Whether it’s the PS Vita that’s due to be on our shores in the not so distant future or a day of pampering at your local spa. Splash your tax refund and enjoy doing so!
Get away from it all – A recent study in America discovered that 57% of people would use their tax refunds to pay for a trip. If like our friends across the pacific a trip is your preferred choice, then you and your friend / partner (they also need to get a tax refund!) will be able to afford to hit the slopes with a three night ski package in Queenstown. Maybe even have a bit left over for the flights, depending on where you’re travelling from.
A good cause – The most rewarding way to spend your tax refund would be to donate it to those that really need it. With so many wonderful charities out there it can be a difficult choice. However as a Christchurch based company we recommend the Red Cross. The Red Cross is part of the largest humanitarian organisation in the world, helping people wherever they might be – internationally or in their own communities. The service and support that they have and continue to offer to local residents affected by the earthquake and on-going aftershocks is second to none.
With 2011 tax refunds just around the corner it’s time you thought about what you would spend the money on. However first and foremost you’ll need to make sure you’ve applied for a tax refund, it’s simple just click here and fill in the form and within 60 seconds you’ll be able to see what you’re owed!*
We’d love to hear what you’re planning to spend your tax refund on so add a comment below: