Wealthy people are wealthy because they have money that they don’t spend. You can’t be wealthy if you spend everything that you have. You have to become a master of having money and needing feeling obligated to spend it.
Many people who are poor are the opposite. As soon as they get money the think about the things they can buy with that money. Some of these people even think about the things they can buy with their money before they even get the money. They spend all their money and that is why they are poor.
One thing I have seen about people who get tax refunds is that they tend to go right back to zero. They get a refund and proceed to give it right away spending it on junk to feel good.
This is a cycle that I am tired of seeing. What I would like to see instead is for people to get a tax refund and make it permanent. Put it aside and get back to work except now you have reserves and net worth.
I put up a post this morning that said “if you are struggling with money you need to work Saturday and Sunday and stop taking days off/vacations”. In response to that someone said “when I get my tax refund I am going to use it to pay off debt”. Who said anything about a tax refund? That is a short cut, that is the easy way out, that will not improve your situation long term.
If you are someone who uses a windfall to pay off debt you are just going to go back into debt. The same is true for those credit repair junkies. The only way to get out of debt and stay out of debt is to feel the pain of sacrifice and chunk out the actual debt.
One thing I have found when it comes to personal finance is that people tend to return to what they know. If you are someone who made a million and lost a million you will soon get back to a million. If you are someone who is broke and comes into money you will soon go back to being broke. Why? Because your habits are what make you not your bank account. Your bank account is just the manifestation of your habits.
If you are someone who plans to use their tax refund to pay off debt or pay for a trip or buy something expensive I recommend that you choose not to do that. You need to focus on improving yourself. You need to become the person that can pay off their debts with their own hands not because the government chose to bless you. You need to become the person that can earn the kind of money to take that trip or buy that bag. That will take YOU and the people around YOU further than a quick hit of cash from the government. If you depend on the government for everything you will always be at the whim of the government. What are you going to do when the government decides they aren’t going to save you? Struggle? No thanks.
One thing that I am grateful for is having parents that told me I could do anything but didn’t do it for me. This pushed me to become a resourceful and hardworking self sufficient person who will get it by any means. This has transferred over to my business. I can get help but if I lose a person that one person isn’t the end of the business. I pick up the ball and run with it. I make it happen because I am the kind of person that will get it done despite assistance or windfalls. I depend on nobody which means nobody can stop the show.
When you live a life dependent on the government you sell yourself short and you sell those around you short. Parents who don’t work and stay at home to watch tv raise children that stay at home with them and watch tv. Bums raise bums. This morning I was talking to a tenant who was begging us not to raise the rent in a year. She told me that she is the only person that has income and her income consists of disability and social security. My question to her was why the men in the home aren’t working. Her response was that they can’t work because they have to take care of her. She pulled them down with her and now they all lose.
If and when you get a tax refund, put it to the side and act like it doesn’t exist. Then go hustle and earn your windfall. What you will find is that hustling will improve you. Hustling will make you more valuable. Becoming more valuable will increase the amount of money you can command from the market. You will work yourself OUT of the need for a refund.
Charity, handouts and entitlements do not advance you. They hold you back. They handicap a healthy person and they handicap an otherwise productive community. You don’t need a windfall you need to get out there and be productive.
Instead of spending the tax refund I encourage you to create an emergency fund with the tax refund. Invest it in stocks or something that will pay you a monthly income. Buy a vending machine. Buy equipment to start a business. Use it as a down payment on a food truck. Use the windfall to improve your situation not make you feel good while you are still in your situation. Whatever you do, do not use that tax refund to ball out if your situation is trash. A year from now you will still be in the same situation or worse. Make the decision to level up.
If you need help figuring out what to do with your refund email me at firstname.lastname@example.org I would love to put a plan in place with you.
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Thanks for reading!
Be great, invest well,