6 great ways to use your tax refund

By Liv Steigrad 2 July 2019 3 min read

Tax refunds. It’s your money, but for some reason it feels like free money.

Receiving a tax refund might feel like a great reason to splash out and buy something you totally don’t need. But before you do, check out what we consider our slightly more judicious suggestions on how to spend your tax refund this year.

1. Top up your emergency fund

The point of an emergency fund is just that: you never know when you might need it. That’s why, if you can, you should consider topping it up during the times you don’t.

2. Plan for the future

You’ve just received a chunk of money you didn’t know you had. Why not put it towards your retirement? Since you didn’t have the money until now, you hopefully won’t miss it. But on the flip side, it could make a substantial difference over the next few years (or decades) in your super account. Think of it as potentially becoming a holiday somewhere warm… when you’re retired.

Do you have young kids? Another option could be to put some money from your tax refund into a high-interest savings account or term deposit for when they come of age. Putting some money aside each year could be a great stepping stone towards their first car, future studies, or a wedding, just to start.

3. Pay off debt

Debt can be a hassle. Perhaps, then, you could use your tax refund to pay off credit card debt or you could put it towards your mortgage. Not only could this help you pay off debt sooner, but you also could reduce your regular repayments. (And if you think you deserve a reward, use the money you save on your next repayment to buy yourself a small treat.)

4. Get the jump on next year's tax deductions

If you’ve been needing to buy a more expensive work-related item but you’ve been putting it off, now might be the time. It could be a new laptop, software, equipment, or even a standing desk to save your back. The sooner you get whatever it is, the sooner you can start using it, and (hopefully) the sooner you’ll see improvements to your work life. You should also check whether you’ll be eligible for a tax deduction, and if so, keep the receipt somewhere safe.

5. Invest it in…

… a fund

Use the money to potentially make more money. If you’ve already got some money in an investment fund, you could add to it with your tax refund. And if not, why not start now? You’ve got a lump sum of money in your hands, and it’s a brand-new financial year. It feels like as good a time as any to develop some new financial habits.

… your financial future

Another option to consider is using your tax refund to see a financial advisor. It might not be the most direct way of using your money to make more money. But clarifying your goals and investing in your future by getting professional advice could be a good idea.

… yourself

Take the opportunity to upskill yourself. Sign up for a class or course that could improve your job prospects. Or maybe it’s time to pursue that creative thing you’ve been thinking about; think a short course in drawing, painting, or pole dancing. The possibilities are endless.

6. Donate it

Get that good karma ball rolling by donating to a cause close to your heart. You’ll feel warm and fuzzy inside, but better yet, you’ll be helping those in need.

Plus, it might be a tax deduction for next year. (Of course, you should double-check the criteria for tax-deductible donations first and make sure your charity of choice ticks all the boxes.)


Whatever you decide to do, it’s always worth having a plan in mind before your tax refund is processed. Once the money hits your account, you’d be surprised at how quickly it can disappear into the ether if you don’t make a strategic move.

Words by
Liv Steigrad Right Chevron

Liv Steigrad is a creative copywriter with a background in psychology. She specialises in cheeky web copy, and can drink an espresso and go straight to sleep.

6 great ways to use your tax refund