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  43. After you come to know how much money you will be getting back as an income tax refund, the biggest question turns out to be-how you are going to use it? And this is quite a good question, which you should even ask yourself because it isn’t everyday that you get a lump sum of money deposited in your bank account directly. Should you party, invest, spend it extravagantly or do something sensible with it? To help you decide, here is an article on how people usually use their tax refunds in NZ.

    Most of the people think this money to be as a free one which has been unaccounted for and thus when it’s ultimately returned to them they do whatever they want with it. They buy things like jetski with high interest or a new iPad, tablet or other gadget, spend an extravagant night out on the casino or town, buy the biggest bottle of champagne, give the money as a loan to a family member or act more sensibly like paying off a chunk of the mortgage.

    However, let us have a look at the statistical approach without which no knowledgeable article would have been complete. As per statistics, here are the top six ways how New Zealander’s use their income tax refunds:

    Paying off the credit card debt-This is undoubtedly one of the most sensible ways to use the tax refund. Many New Zealander’s having credit card debt consider putting these kinds of windfall income directly into lessening the high interest debt.

    Saving it- The big amount of deposit is saved in the bank. People earn interest from it by saving it. There are even many people who save it as an emergency fund. This may sound boring initially but when unexpected expenses take place these savings become very helpful.

    Going for a holiday- There are many people who goes for a holiday with family or friends after getting this money. Spending some memorable and good time with this free money is undoubtedly something that people wish for.

    Go shopping- It is not that all people shop the items that they need. There are many people who even buy items that are not that essential.

    Contributing to charity- Giving the money as a donation for a cause is something great. It is one of the best things one can do when one doesn’t have much time to give. Donations are even tax deductible.

    Investing in yourself- Spending money on yourself is one of the greatest things that you can do. After all, your physical as well as mental well being is very important and in order to keep that in the best condition, you can invest in a health checkup, a massage for relaxation or a yoga lesson.

    However, investing the tax refunds in NZ is the best choice for New Zealanders. So, if there is a refund coming, make sure you invest in something or the other to make the best use of it.

    David writes about finance and business matters in NZ. You can find many of his articles on trust administration, business administration, tax refunds and proactive accountants in Auckland.

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