Tax Tips

A tax refund could be the biggest deposit you see in your account all year. That makes it a great opportunity to advance your financial goals.

Start by checking your credit report to get an accurate picture of your situation. You can get free reports once a year from annualcreditreport.com, or if you’re a Veridian member, you can see a report for free through Credit Central in online banking. 

Once you’ve done that, you can start setting priorities. Since a refund is one-time income, you should avoid making ongoing commitments with that money. Here are some smart ways to use your refund:

• Build your savings. Unexpected expenses seem to pop up at the worst time. Having some savings put aside can help you be prepared.
• Get caught up. Focus on current bills first, then older debt. If you’re trying to improve your credit score, making on-time payments is critical, even if it’s the minimum due.
• Negotiate a settlement. If you have debt in collections, you may be able to work out a deal to pay some and get the rest forgiven. Don’t tell creditors how much your refund was. Make an offer and pay in one or two lump sums instead of over time to protect your credit score.
• Leave really old debt alone. Some types of debt fall off your credit report after seven years of inactivity. If something is about to expire, let it. This only applies to certain kinds of debt, so be sure to get financial advice first.
• Ask for advice. This stuff can be confusing, but Veridian staff can help you create a spending plan, prioritize your debt and set goals. We’re here for your successful financial future – it’s literally our job.

Be aware that as you pay off debt, you’ll likely be contacted by other creditors, who will notice the action on your credit report.

If you'd like to talk to someone about your unique financial situation, fill out the form below.