Real Deal: 5 Ways To Use Refunds

If you are lucky enough to get a tax refund, here are five ways to put that money to work.

The days of blowing it on a big ticket item are over. In a recession, we need look at this as an important investment.

So, here are the top five ways to responsibly invest your tax-refund.

1. Boost your retirement savings. Your portfolio has taken a hit. So if you want your retirement plan stay on track use your refund to maximize contributions to IRAs and 401ks

2. College savings. Here's an opportunity to use your extra money to contribute to a 529 account. You'll be able to use the money tax-free for college bills.

3. Rebuild your emergency fund. During the recession many folks were forced to dip into this fund. Now is the time to replenish it!

4. Pay off credit card debt. Interest rates are thru the roof. So take the card with the highest rate, or the highest balance and use your refund to pay it down.

5. But if you really want to spend your refund, spend to save.

Financial expert Dave Fleisher, president of Firsttrust Financial Resources, explains

"'Let's say some house hold improvements that would typically just be a luxury what this does is, you would be able to get the new windows or something more energy efficient where it's an initial outlay but can pay dividends down the road as far as being more energy efficient and saving dollars overall.”