Author Archives: Khooppres

Planning for Tax Refunds

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Last week’s post was about avoiding tax refund anticipation loans.  Typically, the individuals that would apply for this service are those that expect a sgnificant refund.  In addition to a federal refund, if you pay state income taxes, you will likely receive a refund from the state as well.

Each year, many of us have an opportunity to receive lump sum payments for tax refunds, bonuses, or other types of settlements, but we often don’t have an objective or mission for the funds received.  To be truthful, most of us can’t even account for how the funds were spent.  If you are anticipating a lump sum payment of any kind this year, consider the following:

Pay Yourself First – Commit to saving 10% of the total lump sum amount.  According to a study performed by Insight Center for Economic Development, people of color are five times less likely to have a bank account than whites. If you are not a disciplined saver, I recommend restricting access to this money by depositing the funds into a Certificate of Deposit (CD).  A CD is a type of account that yields a higher interest rate than most savings accounts, and requires that your initial deposit is invested for a fixed period of time.  Please note that most banks will charge an early withdrawal fee if the CD is redeemed before its maturity date.  We all have to start somewhere; this deposit could very well be the beginning of your ‘rainy day’ fund.

Pay Off Debt – Paying off consumer debt can be an overwhelming process, and there are several valid ways to approach it.  In my opinion, the “snowball effect” is one of the most motivating ways to achieve your goal.  This method requires you to pay off the smallest balance first.  Once the debt is paid in full, you then apply the payment that you were making for that account to the next balance.  Although you may pay more in interest, the sense of accomplishment will help keep you committed to your goal.

Complete a Home Improvement Project –   Consider completing a home improvement project that will add value to your home.  If you are in a depressed market, be realistic about how long it will take to recover your investment.  Ultimately, kitchen and bathroom upgrades often offer the best bang for your buck.  By the way, you don’t have to limit your projects to the interior of your home; exterior projects not only boost the value of your home, but they may also help in increasing the value of your neighborhood as well.

Prepay for Lessons or Camps for Your Children – Summer will be here before you know it, and we’re all familiar with the saying, “An idle mind is the devil’s workshop.”  What plans do you have for your children this summer?  If you haven’t started thinking about this, you are behind.  I can’t tell you how many times I’ve heard parents say that they can’t afford to pay for summer camp or other enrichment activities for their kids.  I will admit that this line of thinking frustrates me because these comments often come from parents who have received lump sum refunds or spent money on the latest video game during the Christmas holiday.  If you child is spending their summer at home without any enrichment activities, you should really examine your parenting skills.  I urge you to take a portion of your funds and make an investment in your children.  If you start now, you may qualify for scholarships or reduced rates.  Ultimately you won’t know if you don’t try.  Most programs have filled up by March or April.  Don’t wait; begin your research today.

I hope this Post has been helpful.  Keep in mind, if you always do what you’ve always done, you will get the same results.  Living a reactive life requires no effort on our part, but it takes focus and discipline to be proactive.  The options listed above can assist you in starting a journey toward a life lived on purpose.

Write Down Your Goals For 2012

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We are quickly approaching the end of the first week in 2012.  If you haven’t taken the time to write down your goals for the year, it may be time to do a bit of soul searching.  The fact is most people don’t drive their car without a destination in mind, and a plane doesn’t leave the terminal without a flight plan.  If a plan is required for the routine tasks that we perform on a daily basis, how much more important is it for us to have a plan for our lives?  So, if you haven’t taken the time to write down your goals, it’s time to eliminate excuses and get moving.  Included below are some of the common excuses along with the reasons why they are not valid:

Excuse # 1:  I don’t believe in New Year’s Resolutions.

While I agree with you that we shouldn’t wait until the New Year to change something in our lives for the better, the New Year is viewed as a fresh start for many.  When people use this excuse, it is often based in fear; the fear that they may not accomplish their goals.  If you have used this excuse when asked by others about your goals, I urge you to move in spite of the fear and make a commitment to try.

Excuse #2:  I haven’t written down my goals, but I’ve thought about them.

In the Bible, Habakkuk 2:2 states, And the Lord answered me and said, write the vision and make it plain upon tables that he may run that readeth it.  That being said, a goal that isn’t written down is no goal at all.  If you’ve been so busy this week that you’ve not had time to write down your goals, what do you think will happen next week?  Make yourself a priority and take a moment to document at least one goal for the year.  If you’re having a difficult time getting started, consider the following categories:  spiritual, family and personal. 

Whatever you do, don’t waste time comparing yourself to others.  Many times people aren’t successful in achieving their goals because they are busy trying to achieve someone else’s goals.  Make it personal.  God made you authentic, and I don’t believe he’ll bless your attempt to be someone else.  He’s given each of us our own destiny.  The choice is ours.  Our goals are merely the stepping stones that are required to reach the divine destiny that God has placed before us.

Excuse #3:  I wrote down goals last year and didn’t achieve them.  I don’t want to be a failure.

One thing is certain – if you don’t try, you’ve already failed.  Additionally, how are you measuring success?  In last year’s post, A New Year, A New Beginning, I talk about the all or nothing approach we take when judging ourselves.  This approach leads to self-sabotage.  Many times, it is not the naysayers that keep us stuck, it’s the loud voice in our own minds that tells us we aren’t worthy.  If your perception is you failed at reaching your goals last year, take a moment to document the steps you took toward your goals.  For instance, if last year was the first year you had documented goals, that’s an achievement.  Above all, stop being your worst critic.  If you don’t love yourself that may very well need to be your goal this year.  This is merely my opinion, but if you have a negative perception of yourself, you will likely always struggle to achieve your goals.

Please make the decision to become excited about 2012.  Everything may not go your way this year, but you can choose to have a positive outlook and make the most of each day.  As you make your plans for the year, don’t forget to celebrate each success no matter how small because what we focus on expands.  Happy New Year!

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