Recently CNN Money reported* that the average tax refund this year is $3034, up 3% vs year ago. The last year we could find for Washington State specific data was 2011, at $2788**. Those are nice big refunds. So what can you do with it?
On most top 5 lists of “what to do with your tax refund”, you will find things like paying off debt, and fixing up your home. Updating your home is a great way to spend a tax refund. You get the enjoyment of living in an updated space and the investment benefit of increasing the value of your home.
Here are some ideas that can work for small, medium and large tax refunds, combining more comfortable living with greater home value:
Small refund- up to $500.
- Update your bathroom with new plumbing fixtures. A new modern faucet can transform the look of the sink or tub and create an up-to-date feel throughout the whole room. Add a water saving 1.6 gallon toilet and this mini-remodel will provide savings on your water bill (average is $200 / year vs older toilets). You’ll have more of that tax refund to spend on new towels and cushy bath mats.
- Freshen your inside air by having the heating system cleaned and serviced. Breathe easier with a duct cleaning, filter change and furnace maintenance. You improve the lifespan and productivity of your equipment and take all the dust and allergens out of your system.
- Up your safety with a water leak protection system. This affordable monitoring device will detect leaks and shut off your main water supply, potentially preserving your house and valuables. Tank water heaters of over 8 years old are prone to failing and leaking without notice. Dishwashers, washing machines and even water lines under the kitchen sink can fail as well. These leak protection systems are not just water alarms, and you’ll want to use a licensed plumbing or water heater contractor to install it.
Medium refund- $500 up to around $3000
- Tankless water heaters start at about $3000. Truly a case of affordable luxury meets improved resale value! Tankless water heaters fit natural gas or propane heated homes and provide 15% energy savings when water use remains constant. But more importantly you’ll get to fully fill that tub, or take a shower after the kids are done, without waiting for a tank to refill.
- Get cozier with insulation. Insulation will keep the house cool in summer and the heat in during winter. Not a sexy way to spend your refund but you’ll feel the difference in comfort.
- Give your house a facelift – with a new front door. From traditional to modern there are entry door looks to fit every style. Or maybe it’s a new patio door you’ve been thinking of. Doors have the #1 return on investment (along with siding) so you’ll be adding to the resale value of the home.
- Update your landscaping. Curb appeal works on more than just new buyers, it can lighten your mood when you come home to beautiful natural surroundings. Local landscape and yard service providers can ensure the job gets done right without you lifting a shovel. To make dollars stretch, buy new plants and materials yourself at the local nursery, and just hire the service providers for the literal, dirty work.
Large refund- $3000 and more
- Window replacement. . The technology that is used to manufacture windows continues to improve and 50 year old windows are not as quiet, insulating and energy saving as today’s models. You won’t be able to replace a whole house full of windows for $3000, but it will contribute significantly. Or if you have a mix of old and new windows, this is a great time to finish the project.
- Ensure your comfort year round with a whole house standby generator. You’ll only need it when the power goes out, but when it does, you’ll still be watching TV and your lights and appliances will still be on.
- Make your fun space a comfortable space. Heat and cool your garage, basement or addition with a ductless heat pump. It’s your bonus room but why not be comfortable year round, without the safety risk of plug in space heaters. Ductless heat pumps don’t require adding expensive duct runs in the walls and provide energy efficient heating and cooling. They can be a main heating source for a home, or supplemental for just those areas that aren’t in your heated space. Don’t worry if you don’t have gas to your garage, these run on electricity.
* CNNMoney.com 3/6/14
** Governing.com/gov-data, source IRS