If you were a full-time New York resident (and taxpayer) in 2023, you could be eligible for an inflation refund check from the New York State Office of Taxation and Finance. Single filers could receive up to $200, while qualifying surviving spouses and those who were married filing jointly could receive up to $400 — depending on income.
According to the New York governor’s website, checks started going out in October. If you’ve received yours, or when you do, the question is: What are you going to do with it?
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Pay Down Some Debt
The obvious — and least exciting — option is to use it to pay off some of your existing debt. Consider tackling a high-interest-rate credit card or, if you’ve got one, a payday loan.
Payday loans are generally no more than $500, as per the Consumer Finance Protection Bureau. For every $100 borrowed, you’ll usually have to pay an additional $10 to $30. So, a $100 loan could cost $110 to $130. A $400 loan could cost $440 to $520.
If you receive $200 or $400, you could potentially wipe out that entire debt.
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Start an Emergency Fund
Many financial experts recommend having three to six months’ worth of expenses set aside for emergencies. But that’s not always feasible, especially if you don’t have much in the way of savings already.
In that case, you could always start small. Dave Ramsey’s website suggests having at least $1,000 set aside as a starter fund. A $200 check will get you a fifth of the way there — no fuss or stress. A $400 check is almost halfway there.
That kind of money could also be significant if you end up getting a flat tire or small medical bill you didn’t expect. Rather than having to charge a high-interest credit card or take out a short-term predatory loan, you can simply pay in cash.
Invest In Yourself
Already have a small emergency fund going? Chris Motola, financial analyst at National Business Capital, suggests using it for something for you.
“Invest it, but use the refund to invest in yourself,” he said. “It’s around the right amount of money to try out a course or club membership.”
Don’t underestimate the importance of your physical or mental health. Taking care of yourself could mean less stress, which can also help you stay on top of the things that matter in your life.
Invest In Your Hobbies
Not everything has to be about traditional investing. If you receive an inflation refund check and you’re not stressing about paying the bills, why not focus on your interests?
“Consider upgrading a tool of your trade or equipment related to a hobby you enjoy,” said Motola. “If you hit the jackpot, so to speak, it could also expand your social circles and contacts. That’s a pretty good return on investment (ROI) on a couple of hundred bucks.”
Put It Toward Groceries
If inflation is getting you down, you can always use the refund check to counteract the rising costs. Even if it’s only for a month, that extra relief can go a long way.
One option is to put it toward the grocery bill. The latest Federal Reserve data estimates that the average consumer spends $6,053 on groceries each year. That’s $504 a month. Depending on your household and nutrition needs, your refund check could (almost) cover that entire bill.
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This article originally appeared on GOBankingRates.com: Getting an Inflation Refund Check? 5 Suggested Money Moves To Make With It
