Tag Archives: Charity

7 Worthwhile Ways to Use Your Tax Refund

 

SYB-Logo_Since1904

According to the Internal Revenue Service, more than 70 percent of the nation’s taxpayers received a tax refund averaging nearly $3,000 in 2017 and will get a similar amount this year. As Americans receive their refunds along with additional benefits coming from the Tax Cuts and Jobs Act passed in December, we have highlighted seven tips to help them use their money wisely.

To help consumers make the most out of their money, We have provided you with the following tips.

  • Save for emergencies.  More than 60 percent of Americans are not prepared for unexpected expenses. You can prepare by opening or adding to a savings account that serves as an “emergency fund.” Ideally, it should hold about three-to-six months of living expenses in case of sudden financial hardships like losing your job or having to replace your car.
  • Pay off debt.  Pay down existing balances either by chipping away at loans with the highest interest rates or eliminating smaller debt first.
  • Save for retirement, your child’s education or future health expenses. Open or increase contributions to a tax-deferred savings plan like a 401(k) or an IRA. Your bank can help set up an IRA, while a 401(k) is employer-sponsored. Look into opening a tax-advantaged 529 education savings plan to ensure school expenses will be covered when your child reaches college age. Or save for future health expenses with tax-free dollars by investing in a Health Savings Account.
  • Pay down your mortgage or student loans.  Make an extra payment on your mortgage or student loans each year to save money on interest while reducing the term of your loans. Be sure to inform your lender that your extra payments should be applied to principal, not interest.
  • Invest safely with U.S. savings bonds or municipal bonds. The U.S. Treasury allows for savings bond to be purchased using your tax refund for as little as $50. Savings bonds earn interest for a maximum of 30 years.
  • Invest in your current home.  Use your refund to invest in home improvements that will pay you back in the long run by increasing the value of your home.  This can include small, cost-effective upgrades like energy-efficient appliances that will pay off in both the short and long term – and with tax credits (as long as Congress continues to renew the program).
  • Donate to charity.  The benefit is two-fold: Giving to charity will make a difference in your community, and you can also claim the tax deduction, if you itemize.

Resource information provided by the American Bankers Association.

SYB-Logo_.png

Advertisements

Holiday Giving: How to Become a Savvy Charitable Giver

It’s hard to believe there are only 8 days left until Christmas! For many people, it is important to take time during the holiday season to give to those who are in need.  Donating to your favorite cause can be fulfilling, but it’s important to ensure that your gift reaches the intended source. Follow these tips to become a savvy charitable giver this holiday season:

  • Give To an Established Charity
    Unfortunately, there are fraudulent charities that will take advantage of your goodwill.  To avoid this situation, ask for written information about the charity, including name, address and telephone number. A legitimate charity will give you information about their mission, how your donation will be used and proof that your contribution is tax deductible. Find a charity with a proven track record for providing aid.
  • Designate Your Gift
    Some charities allow you to specify exactly where your gift is headed, either to a specific orphanage, to purchase school supplies or to a geographic area in need of relief.  By designating or earmarking your gift, you control where your donation goes and whom it helps.
  • A Proactive Giver is a Smart Giver
    Wise givers don’t give on an impulse or to the first organization that comes along.  Smart givers take time to identify the causes important to them.  Contact a charitable organization, find out their mission and what type of aid and programs they offer.  Work with charities that have targeted outcomes for their giving.
  • Benefits to You
    A donor’s primary motivation may be altruism, but everyone knows there are great tax benefits for those who give. A donation to a qualified organization may entitle you to a charitable contribution deduction.  Remember a contribution to a qualified charity is deductible only in the year in which it is paid, and all charities do not qualify for a charitable contribution deduction.  Always ask for a receipt and save them for tax time.
  • Consider Giving Your Time
    Four out of five charities report using volunteers.  Volunteers are the foundation of many charitable organizations. If you can’t afford to donate money, consider donating your time.  Common volunteer duties include: stuffing envelopes, feeding animals, tutoring, building homes, serving as a museum docent, counseling those in crisis, selling tickets or answering phone calls.

Visit these other sites to find out more on charitable giving:

Resource information provided by the American Bankers Association