7 ways to make the most of your tax refund & stimulus check

Because of the COVID-19 outbreak, CVOEO has ended its free in-person tax help program. We recommend using myfreetaxes.com for simple returns.

If you filed taxes in 2018 or 2019 or receive SSDI or VA benefits the federal government will be sending you a stimulus check directly. If you did not file taxes, you need to fill out a form with the federal government so that they know where to send your money to. You can do that by visiting this website: https://www.irs.gov/coronavirus/economic-impact-payments

Remember that money is like water: it flows away from you! Make a plan for this money as soon as you can, so the money goes where you truly want it to go. Some ideas:

  1. Direct Deposit: When filing your taxes, split your refund between your checking and savings account! You can also split your stimulus check in the same way once the funds are received.
  2. Reduce credit card debt: Debt is very expensive.  Consider the 30-40-30 Plan when making a plan for your refund or stimulus check: 
    1. Designate 30% of your refund and/or stimulus check to paying off debt and catching up on outstanding bills
    2. Earmark 40% for current use
    3. Use 30% to jumpstart an emergency fund or longer term savings
  3. Save for a major appliance: Try to anticipate what big expenses are coming up in your life and put a portion of the refund toward that - a major appliance, a car repair or tires, etc.
  4. Create an emergency fund: We can't emphasize saving enough!  It can make a big difference when you experience "unexpected" expenses - and we all know they do come up!   TAX REFUNDS ONLY: If you save $50 or more from your refund, you can enter to win prizes at Save Your Refund!  Make sure to check out their website to learn more!  Or you can purchase a Savings Bond when you distribute your refund when filing your taxes.
  5. Save for a child's education: Open up or add to a Vermont 529 College Savings Plan!
  6. Boost retirement funds: Add to an existing 401k, 403b, or IRA.
  7. Pay down on home mortgages: Paying extra on your mortgage can save you a lot of money in the long run! Consider this option after more expensive debts -- especially high rate credit cards -- are paid off completely.

If you'd like some assistance while making your plan for your refund or stimulus check, feel free to join the Growing Money Program! After completing at least one Growing Money class, you will be invited to meet 1:1 with a financial coach to discuss your personal financial situation and goals. Click to register for classes here.

Back to Top

CVOEO addresses fundamental issues of economic, social, and racial justice and works with people to achieve economic independence.


 

Serving more than 10,000 households annually,
impacting the lives of over 23,000 individuals