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8 ways to make your tax return work for you

8 ways to make your tax return work for you

You would be amazed how much difference even a little financial breathing room can make. When you start playing offense rather than defence financially, your financial goals suddenly start looking reachable. In turn, you start getting excited about the direction of your finances — and your life in general.

Here are eight tips to do with your tax return:

1. Create an emergency fund

Many Australians don’t have an adequate savings account accessible in case of a sudden financial need.  When the unexpected hits, the last thing you want to be doing is maxing out a high interest rate credit card. A rainy-day stash of cash can be a lifeline when life gets hard. Look out for an account offering high-interest, and if possible, add to your emergency fund regularly – you will be surprised how quickly it grows.

2. Pay off debt

Consider using your tax refund to lower your credit card debt or pay it off. Your interest repayments will drop as soon as you lower your outstanding balance. Once you’re debt-free, start using your money for you, rather than contributing to the bank’s profits by paying credit card interest repayments. Going this way allows you to put more money in the bank every month once those minimum payments vanish from your list of bills.

3. Contribute to your superannuation

You can use the tax return to make a personal contribution to your super, which is funding your retirement. Boosting your super early on means there is more time for your super savings to grow. The contribution can be deducted off your taxes again next year.

4. Start an education fund

If you have children or grandchildren, you would be doing them a huge favour by saving your refund in an education fund for their benefit. Setting up a plan can help them afford a higher education in an era where rising costs leave many saddled with massive debt along with their degree or diploma.

5. Invest in the share market

Historically, the stock market has offered a greater return on investment than a savings account. While the fluctuations make it a riskier choice for money you will likely need in the shorter term, the long-term outlook makes it a better option if you don’t have an immediate financial need. Before investing in anything, it pays to either a) do research to make an informed decision or b) seek professional financial advice. Depending on the amount you have available to invest and how savvy you are, there are plenty of investment options available.

6. Invest in yourself

Whether it’s a new certification, degree, licence, or some other qualification, use your tax refund to help you reach your career goals. Yes, it costs money and time — hence the word “investment.” But it can lead to that promotion you have been angling for or help you secure a new, better job entirely. The costs of the course can be deducted off your taxes again next year.

7. Start a business

You don’t have to quit your current job to start your own business or side hustle. In today’s world, it’s easier than ever to start your own business, especially for online businesses with few start-up or overhead costs. You can even convert a hobby into a business opportunity and eventually quit your day job.

8. Improve your home

If you live in an older home, spending some of that refund around the house (e.g. replacing old windows or insulation) or on upgrading appliances can lower utility bills such as electricity and gas. If your kitchen or bathroom is out of date, a remodelling project can improve the functionality of your house now and potentially improve your property value should you decide to sell.


Whether it’s a significant windfall or just a drop in the bucket, treat your refund like found money. If you are smart, you can put it to work for you and improve your financial situation. Do not blow it on some unnecessary or impulsive splurge.

Book an initial consultation at one of our office locations in The JunctionErina and Sydney CBD – your first appointment is complimentary, so you have nothing to lose.

The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group They cannot be reproduced in any form without the express written consent of the author. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice. Sydney Wealth Advisers is a subsidiary of Coastal Advice Group which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429. This editorial does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information, you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser. From time to time we may send you informative updates and details of the range of services we can provide. If you no longer want to receive this information, please contact our office to opt out.

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