Tax time can cause headaches, but the strain often pays off. While fewer people are receiving refunds this year — due to changes in the 2017 Tax Cuts and Jobs Act — those refunds do represent a serious chunk of change, according to Internal Revenue Service numbers. The average refund, as of March 15, is $2,957. That’s a lot of money, and it’s tempting to blow it all on the spot. But stop and count to 10. You worked hard to earn that amount, and prudence calls for a thoughtful spending plan.
Related: 30 Ways Your Tax Return Could Trigger an IRS Audit
KITCHEN UPGRADE
Remodeling an entire kitchen can easily cost more than $10,000, but smaller DIY projects can make the space feel like new and cost much less. Replace the countertops or flooring, repaint the room, or install new sink and cabinet hardware.
PROGRAMMABLE THERMOSTAT
A programmable thermostat is unlikely to eat up an entire refund, and it can more than pay for itself in relatively short order. The federal government’s Energy Star program estimates that you can save more than $180 a year by setting the thermostat to raise or lower the temperature automatically while you’re sleeping or away from home.
OUTDOOR FOOTWEAR
With warm weather on the horizon, it’s time to hit the trails and enjoy some fresh air. Whether you’re a runner or hiker, a new pair of high-quality shoes or boots can last for years. Proper footwear also protects against injury, making it well worth the money.
BEAUTY REST
You spend hours every day lying in bed, so it’s worth every penny to have a mattress that’s comfortable. A tax refund is an opportunity to invest in something that will pay dividends every night.
HIGH-QUALITY SHEETS
Speaking of beds, have you bought bedding recently? A soft but breathable set of sheets will work well for the upcoming warm months. But don’t get tricked into thinking a high thread count is always best. Going above 400 may be a waste of money, according to a study by Consumer Reports.
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VACATION
It’s hard to find a better way to spend money than on new experiences. Studies show that experiences and the anticipation leading up to them result in more “happiness” than physical products. Use a tax refund to get out of town and enjoy a nice vacation.
Related: 21 Adventures for Thrill-Seeking Senior Travelers
STAYCATION
If a vacation isn’t in the cards right now, set your sights on a pleasurable or fun-filled day trip. Spend some of that wad on a “staycation” and enjoy a spa day, an overnight at a cozy bed and breakfast, or a weekend camping trip.
EDUCATIONAL TOYS
Educational toys keep children entertained while stimulating their minds, a win-win. The Oppenheim Toy Portfolio awards, Parents’ Choice Awards, and several other organizations point to the top toys. For older kids, even a laptop or tablet would be covered by the average refund.
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TIME
A tax refund can buy time, if you know how to spend it. For example, hire someone to clean the house for about $20 an hour. With a $2,957 refund, that’s about 148 hours of work, more than 2½ hours every week.
WINDOWS
Replacing just one or two windows won’t do too much, but refitting a house with double-pane windows can decrease the amount of energy consumed by 18 percent to 24 percent year-round, according to HomeAdvisor. Prepare for the summer and buy solar shades for even more efficiency and comfort.
VACUUM SEALER
Vacuum sealers preserve food by sealing it in plastic bags. The Natural Resources Defense Council reports that the average family of four throws away about $1,500 in food a year. Imagine being able to save that money — and enjoy leftovers.
Related: 50 Food Storage Tips to Help Save Money and Cut Waste
LIGHT BULBS
LED technology has advanced over the past few years, and today’s LED light bulbs offer the same warm glow of incandescent bulbs but use a fraction of the energy. Many LED bulbs pay for themselves within 18 months and go on to save money for decades more. Some are even remote controlled and dimmable, or can change colors.
PICNIC GEAR
Get ready for fun in the sun with a new picnic basket, blanket, and cooler. Free concerts and activities run throughout the summer, and buying supplies now leaves one less expense to worry about later.
BATHROOM FACELIFT
A bathroom remodel can cost a lot — but replacing one or two pieces instead is an affordable way to give the space a facelift. Buy a new toilet or sink, or replace or cover up the floor and shower surfaces to get the most bang for your buck.
SMART POWER STRIPS
“Vampire drain,” the energy used by electronics when they’re powered off but still plugged in, costs every American household about $165 annually, according to the NRDC. Smart power strips help eliminate vampire drain with on/off switches and by automatically turning off.
Related: 25 Smart Home Products That Are Worth the Money
HOUSEPLANTS
A bit of greenery in the home has numerous benefits — they improve air quality, happiness, sense of satisfaction, and overall emotional health. In the office, plants have a positive effect on employee productivity. If you don’t have a green thumb, start simple with succulents or air plants and make your way up to more traditional houseplants.
Related: 22 Tips to Keep Gardening Dirt Cheap
STORAGE AND ORGANIZATION
If the garage or closet, or both, are a mess, spend some money and time to get things organized. Buy shelving units, storage boxes, and whatever else is needed to keep everything in its place.
CURB APPEAL
Put a smile on your face every time you come home by using your tax refund to upgrade the porch or landscape the space in front of the house. A door, bench, shoe shelf, shrubs, or small tree can make a big difference.
ENERGY-EFFICIENT APPLIANCES
Not only is a new appliance a welcome upgrade, but it pays dividends over the long term. A new refrigerator can save more than $50 a year over a 15-year-old model, and a washing machine can save about $175 a year on energy costs.
Related: The Best Washing Machines Under $500
HAPPINESS
A Harvard University study found that there is indeed a way to buy happiness: Give away your money. Buy the next round of drinks for friends or find a cause you believe in and use some of the tax refund to give back to the community, writ large or small.
