We are happy to inform you that the Colorado Tabor Check Refund is coming. It’s a great time to start thinking about how you will use your refund and what kind of investment strategy might be right for your financial goals. We think you should consider investing some of that money.
What is the Colorado Tabor Check Refund?
Voters of Colorado approved the Taxpayer’s Bill of Rights (TABOR) Amendment in 1992. This amendment to the Colorado Constitution generally restricts the amount of revenue state governments can retain and spend. And Colorado collected too much in taxes so you will be getting a refund.
The first physical checks will be mailed to Colorado taxpayers beginning the 2nd week of August 2022. The majority of people should receive their checks right away, according to the governor.
Anyone who filed a tax return in Colorado should receive $750 from the state, or $1,500 for joint filers. Governor Polis signed the early TABOR refund into law back in May. To prevent fraud, residents should be aware that the money will arrive in the mail and not via direct deposit.
What can you do with the money?
You can use the money to pay off debt, save for a vacation or car, save for college tuition or even retirement. It’s your money—do whatever you want with it! But we think you should consider investing some of that money.
If you are like most people, you are probably going to use the refund to pay bills.
It’s always nice to have an extra bit of cash in your pocket, but it’s even better when you can use the money for something that will benefit you in the long run.
Here are some ways you can use your Colorado Tabor Check Refund…
Build an emergency fund.
The first thing you should do with your tax refund is to build an emergency fund. This money will come in handy for unexpected expenses such as a car repair or medical care. It’s important that the fund be large enough to cover these types of costs and easy to access, so that you can access it in case of need.
It’s also important that the money be liquid (meaning, it’s not tied up in investments), because then you’ll have ready cash on hand when emergencies arise. If you don’t have an emergency fund, this is where you should start.
Pay off high-interest debt.
The most effective way to use your tax refund is to pay off high-interest debt first. With interest rates on credit cards often in the 20% range, you can see just how much money you could save by paying off a $750 – $1500 balance with a 19.99% APR. However, if you have no other debts and aren’t struggling financially, we recommend investing your tax refund instead.
Fund your retirement savings account.
Your retirement savings account is a powerful tool that can help you build your financial stability, but it’s also easy to forget about—and therefore under-fund. When you get your tax refund, put some money toward the account right away so it doesn’t slip through the cracks again. This is where you call us. We can help make sure it goes to the best place to help you achieve your financial goals.
If you want to invest your cash this year, contact us today! We can help you navigate your options and make the most out of your money. We are available to answer any questions you may have.
Risk Disclosure: Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance does not guarantee future results.
This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The content is developed from sources believed to be providing accurate information; no warranty, expressed or implied, is made regarding the accuracy, adequacy, completeness, legality, reliability, or usefulness of any information. Consult your financial professional before making any investment decision. For illustrative use only.
Stephen Pease, David W. Smiley and Matt Hoaglin are Investment Advisor Representatives with Dynamic Wealth Advisors dba Oxford Financial Planners. All investment advisory services are offered through Dynamic Wealth Advisors.