Okay, so it’s nearly that time of year. You may be thinking about how you have to file taxes online or maybe you already have them done. Either way if you are expecting a refund from Uncle Sam than you have already started dreaming about what you will do with it. Same here. Though some will certainly say it is silly to loan the government money, my family usually overpays our taxes during the year and thus we get a refund. We don’t do it as some sort of savings plan, we do it to cover our behinds. I am self employed and my income is unpredictable at best. It just makes us feel better to overpay and make sure we are covered in that department. And let’s face it, it you have no willpower than having a savings account you cannot touch but once a year is kind of logical.
So…what to do with all that moolah? Well, big or small there are probably a few purchases that you can make that will be helpful in the long run to help you live greener, save money, and be more self sufficient. I understand the tendency to want to blow the money on a trampoline for the kids or a down payment on a newer (but really unneeded car). Part of our personal refund is in fact allotted to purely fun stuff since paying higher taxes throughout the year meant less fun money to play with. But now is also the time to make smart purchases that will pay all year long and even for years to come. Here are a few ideas:
Freezer – A stand alone freezer (either upright or chest) is a great purchase if you want to save money on healthier foods. Being able to freeze more food makes it possible for you to buy in bulk, purchase more sale items, preserve seasonal, local foods, and to store a herd share. If it is cheaper in the long run to buy 20 pounds of raw almonds then go ahead and do so and then freeze the ones you wont use within the first month or so. Extend blueberry season by visiting the pick-your-own farm and buying enough (and freezing them) to get you through to next season. Having a freezer can really help you save money long term and they are generally cheap to power. Look for an energy star model and/or buy used from Craigslist.
Remodel/Refurbish Supplies – Using tax money to do home improvements is always a smart decision. You can refinish your deck, insulate the attic, paint, install a programmable thermostat, replace carpet and laminates with wood or tile, replace appliances with more energy efficient models, etc. Think about the projects you can do now that will increase the value, efficiency, and comfort of your home.
Gardening Materials – Growing your own food is like printing money according to TED speaker Ron Finley so investing in what you need to grow more of your own food just makes good sense. You may want to use refund money to build raised beds or to buy equipment such as a tiller, hoe, shovel, etc if you plan to sow your seeds directly into the soil. If you have a small area to grow in you may want to buy pots and planters that will fit on decks and inside window sills. A compost bin can be very affordable if you are able to build it yourself, and building plans are abundant online. Buying a plot at your local community garden is another option. Just don’t forget to reserve a small amount for buying heirloom seeds!
Canning, Preservation, and Food Storage – If you grow your own food or buy in bulk during the growing season then you need a way to preserve it for the off season. I mentioned the benefits of a freezer (above) but also helpful would be a good dehydrator. Canning supplies are another good investment and a vacuum sealer is also a good idea if you buy meat in large quantities (see below for info on that). I hate contributing to plastic waste but I also hate to waste money on good grass fed beef!
You may also want to overhaul your food storage containers. Ball jars and Pyrex always work well and you can pick them up cheap at yard sales and auctions. I use the half gallon size jars for everything from almond flour and nuts to dehydrated apple slices. If you want to save money on bulk and preserved foods, then you have to have a place to keep them that will preserve their freshness.
CSA share or Herd share – A CSA stands for community supported agriculture. It is basically a system where you pay a quarterly or annual fee direct to a local farmer and in return you get a box of home grown foods each week or so during the growing season. A herd share is where you pay your farmer for your “share” of a cow, pig, etc. You can buy a whole pig, half pig, quarter cow, etc. You essentially pay the farmer to board and feed your animal and then when butchering time comes, your fees pay for a certain amount of the meat from the animal. In case of dairy cows your share pays for weekly raw milk. Doing a herd share eliminates the middleman to save you money and you can choose to support farmers who raise their animals humanely, feed them appropriate foods, and don’t inject them with growth hormones.
The down side is that you get a large amount of meat all at one time so you need to be able to store it. In the long run and health wise it makes good sense to go this route if you can though. Your beef needs for the year will be covered with no time wasted looking for sales. The quality is much better than what you will find in stores too.
Clothes Line and Drying Racks – Dryers are a big waste in the energy department so it makes sense to use wind and solar power to dry your clothes if you can. You can purchase a clothing line or a drying rack for a relatively small investment, so why not? If I owned my own property then I would totally go for big steel T-posts and good thick lines just like my grandmother had. She even had raised flower beds surrounding both of her posts. But for people looking for something requiring less work and space you can get a parallel style clothes dryer and even drying racks which can be used indoors and out.
Take a Class – Do some searching in your city to find specialty classes that you can take and invest in your own education. If my location is any indication of what is available then you can take classes on quilting, sewing, canning, bread making, pie baking, pottery, wild food foraging, animal butchering, maple sugaring, etc. Many places offer classes in homesteading and life skills like this so take advantage of them!
Alternatively, and just to bring you another side to this story, here are some dumb things you can do with your refund!
Not paying Down Debt - Yes, believe it or not, paying debts is not tops on the list when the tax refunds begin. Many people would rather use their refund for “fun” stuff or even increase their debt load by using it as a down payment for even more debt.
Solution: The first place that any tax refund money should go is consumer debt. Why on earth would you spend it on anything else except that gaping hole in your wallet that is bleeding money every month via interest charges? Start the debt snowball or debt avalanche, whichever you prefer, and start the ball rolling with your refund.
Eating Out - Ugh. Really? You are going to blow a big chunk of that refund on overpriced food? Those burgers or sushi rolls better be really darn memorable!!
Solution: Only allow for one nice meal with the family. If you have anything left you want to spend on food, try a herd share or pre pay for a spring/summer CSA share.
New Furniture - The amount of people that go and buy new furniture sets is crazy. There is a reason why so many furniture stores advertise during this time of year. Do you really need a new dining set, bedroom set, or theatre style recliners?
Solution: If you do want to replace a few worn out pieces of furniture try Craigslist or the Facebook marketplace first. Also garage and estate sales. Get something slightly used and much cheaper.
Not Investing It - For many people tax refund time can be the biggest chunk of money they get all at once. It is easy to go crazy but you can turn that refund into even more money if you are smart.
Not Saving It - The amount of people who have no emergency fund is staggering. They have no financial umbrella in the event of a storm such as job loss, the breakdown of a car, or a serious illness. These curveballs cause many people to go into massive debt or even bankruptcy. Even if you don’t use it for emergencies, there are always unforeseen big events around the corner, be it a wedding, birth or, sadly, an illness. Ok, some of those are extreme examples, but you get the idea.
Solution: Use all or part of your refund to start an emergency fund if you don’t already have one. If you have debt you need to pay off, then a small baby fund of $1000 can get you started until you are debt free. Everyone needs to self-insure against life’s emergencies and events.
So there we have it, I could go on with these lists, You may think I’m being over cautious with some of them, but it will pay off some day to live on the conservative side. You never know what is around the corner!