Advertising
Advertising

4 Surprising Ways You Can Invest Your Tax Return for Even More Money

4 Surprising Ways You Can Invest Your Tax Return for Even More Money

When most people get their tax returns back – which can sometimes reach a few thousand dollars – it’s almost like scoring another payday. But the problem with these returns is that people tend to look at them as “free cash” or “play money,” when the reality is that you earned that money. It was simply withheld from you and is finally coming your way.

If you want to be smart about how you use your money, you shouldn’t just go out and blow the money on discretionary purchases. In fact, this is the perfect opportunity to dip your feet into the investment world. While you may not be able to get involved in high-dollar investments, you can certainly try some avenues that only require a few hundred or thousand dollars to get started.

Here are a few:

Advertising

1. Penny Stocks

While there’s no reason you can’t get involved in standard stock trading with a few thousand dollars, it’s not always the smartest move to go from no investing activity to high-dollar stock investments. Instead, you may want to get started with lucrative penny stock investing.

As the name suggests, penny stocks are stocks that are typically priced at less than one dollar. While these stocks are much less regulated than the ones you see on the Dow Jones, Nasdaq, or S&P500, they can also grow at a much swifter pace. Check out this guide to see if this could be a good low-entry investment for you.

2. Mutual Funds

Are you interested in standard stock market investing – but afraid of the risks? You can actually eliminate much of your risk by choosing mutual funds. While most require a minimum investment of a few thousand dollars, some will even let you get started with just a few hundred dollars.

Advertising

In a mutual fund, your money gets pooled together with thousands of other investors and a mutual fund manager then diversifies the funds across many different high-performing stocks to yield strong returns (without heavy risk). When the stock market is performing well, you can earn very solid returns.

3. Peer-to-Peer Lending

If you’re willing to take on a bit more risk – and like the idea of helping others – you may consider peer-to-peer lending. This direct method of debt financing lets individuals – like yourself – lend money to people who need financial assistance to pay for home improvements, launch a business, or purchase a car.

Using a website like Lending Club, you can choose who you want to lend to, set the terms, and collect interest. While there is a certain amount of risk associated with lending, the average rate of return is generally between five and eight percent. Not bad!

Advertising

4. Make a Down Payment on Real Estate

Everyone knows just how profitable real estate investments can be, yet few of us ever have the funds to get started. Well, now is as good a time as any to start building your real estate empire.

With just a few thousand dollars, you can place a down payment on a small rental property that you can then use to cash flow a few hundred dollars per month. By doing your due diligence and making a smart decision, you can also expect most properties to naturally appreciate over time. It’s a great way to diversify your portfolio.

Make Smart Choices

People often complain about not having enough money to set aside for investments. Well, maybe it’s time that you start looking at your annual tax return as an investment fund that can be used to fund things like penny stocks, peer-to-peer lending, down payments, and other things. You won’t be sorry!

Advertising

Featured photo credit: Julien GONG Min via flic.kr

More by this author

Anna Johansson

Anna is a freelance writer, researcher, and business consultant.

20 Best Productivity Apps for Mac You Should Have in 2018 10 Uplifting Positive Affirmation Apps That Help You Re-Center on the Go 10 Qualities of a Leader (Advanced Version for Leaders Who Aim High) hourglass as time is wasting 15 Ways You Are Wasting Time During the Day (And How to Stop) When You Have These Recipes, You No Longer Need to Suppress Your Appetite for Dessert.

Trending in Money

1 How to Answer the Tough Question: What are Your Salary Requirements? 2 How Personal Finance Software Helps You Get More Out of Your Money 3 The Definitive Guide to Get Out of Debt Fast (And Forever) 4 35 Real Ways to Actually Make Money Online 5 30 Fun Things To Do With Your Friends Without Spending Much

Read Next

Advertising
Advertising

Published on November 8, 2018

How to Answer the Tough Question: What are Your Salary Requirements?

How to Answer the Tough Question: What are Your Salary Requirements?

After a few months of hard work and dozens of phone calls later, you finally land a job opportunity.

But then, you’re asked about your salary requirements and your mind goes blank. So, you offer a lower salary believing this will increase your odds at getting hired.

Unfortunately, this is the wrong approach.

Your salary requirements can make or break your odds at getting hired. But only if you’re not prepared.

Ask for a salary too high with no room for negotiation and your potential employer will not be able to afford you. Aim too low and employers will perceive as you offering low value. The trick is to aim as high as possible while keeping both parties feel happy.

Of course, you can’t command a high price without bringing value.

The good news is that learning how to be a high-value employee is possible. You have to work on the right tasks to grow in the right areas. Here are a few tactics to negotiate your salary requirements with confidence.

1. Hack time to accomplish more than most

Do you want to get paid well for your hard work? Of course you do. I hate to break it to you, but so do most people.

With so much competition, this won’t be an easy task to achieve. That’s why you need to become a pro at time management.

Advertising

Do you know how much free time you have? Not the free time during your lunch break or after you’ve finished working at your day job. Rather, the free time when you’re looking at your phone or watching your favorite TV show.

Data from 2017 shows that Americans spend roughly 3 hours watching TV. This is time poorly spent if you’re not happy with your current lifestyle. Instead, focus on working on your goals whenever you have free time.

For example, if your commute to/from work is 1 hour, listen to an educational Podcast. If your lunch break is 30 minutes, read for 10 to 15 minutes. And if you have a busy life with only 30–60 minutes to spare after work, use this time to work on your personal goals.

Create a morning routine that will set you up for success every day. Start waking up 1 to 2 hours earlier to have more time to work on your most important tasks. Use tools like ATracker to break down which activities you’re spending the most time in.

It won’t be easy to analyze your entire day, so set boundaries. For example, if you have 4 hours of free time each day, spend at least 2 of these hours working on important tasks.

2. Set your own boundaries

Having a successful career isn’t always about the money. According to Gallup, about 70% of employees aren’t satisfied with their current jobs.[1]

Earning more money isn’t a bad thing, but choosing a higher salary over the traits that are the most important to you is. For example, if you enjoy spending time with your family, reject job offers requiring a lot of travel.

Here are some important traits to consider:

  • Work and life balance – The last thing you’d want is a job that forces you to work 60+ hours each week. Unless this is the type of environment you’d want. Understand how your potential employer emphasizes work/life balance.
  • Self-development opportunities – Having the option to grow within your company is important. Once you learn how to do your tasks well, you’ll start becoming less engaged. Choose a company that encourages employee growth.
  • Company culture – The stereotypical cubicle job where one feels miserable doesn’t have to be your fate. Not all companies are equal in culture. Take, for example, Google, who invests heavily in keeping their employees happy.[2]

These are some of the most important traits to look for in a company, but there are others. Make it your mission to rank which traits are important to you. This way you’ll stop applying to the wrong companies and stay focused on what matters to you more.

Advertising

3. Continuously invest in yourself

Investing in yourself is the best investment you can make. Cliche I know, but true nonetheless.

You’ll grow as a person and gain confidence with the value you’ll be able to bring to others. Investing in yourself doesn’t have to be expensive. For example, you can read books to expand your knowledge in different fields.

Don’t get stuck into the habit of reading without a purpose. Instead, choose books that will help you expand in a field you’re looking to grow. At the same time, don’t limit yourself to reading books in one subject–create a healthy balance.

Podcasts are also a great medium to learn new subjects from experts in different fields. The best part is they’re free and you can consume them on your commute to/from work.

Paid education makes sense if you have little to no debt. If you decide to go back to school, be sure to apply for scholarships and grants to have the least amount of debt. Regardless of which route you take to make it a habit to grow every day.

It won’t be easy, but this will work to your advantage. Most people won’t spend most of their free time investing in themselves. This will allow you to grow faster than most, and stand out from your competition.

4. Document the value you bring

Resumes are a common way companies filter employees through the hiring process. Here’s the big secret: It’s not the only way you can showcase your skills.

To request for a higher salary than most, you have to do what most are unwilling to do. Since you’re already investing in yourself, make it a habit to showcase your skills online.

A great way to do this is to create your own website. Pick your first and last name as your domain name. If this domain is already taken, get creative and choose one that makes sense.

Advertising

Here are some ideas:

  • joesmith.com
  • joeasmith.com
  • joesmithprojects.com

Nowadays, building a website is easy. Once you have your website setup, begin producing content. For example, if you a developer you can post the applications you’re building.

During your interviews, you’ll have an online reference to showcase your accomplishments. You can use your accomplishments to justify your salary requirements. Since most people don’t do this, you’ll have a higher chance of employers accepting your offer

5. Hide your salary requirements

Avoid giving you salary requirements early in the interview process.

But if you get asked early, deflect this question in a non-defensive manner. Explain to the employer that you’d like to understand your role better first. They’ll most likely agree with you; but if they don’t, give them a range.

The truth is great employers are more concerned about your skills and the value you bring to the company. They understand that a great employee is an investment, able to earn them more than their salary.

Remember that a job interview isn’t only for the employer, it’s also for you. If the employer is more interested in your salary requirements, this may not be a good sign. Use this question to gauge if the company you’re interviewing is worth working for.

6. Do just enough research

Research average salary compensation in your industry, then wing it.

Use tools like Glassdoor to research the average salary compensation for your industry. Then leverage LinkedIn’s company data that’s provided with its Pro membership. You can view a company’s employee growth and the total number of job openings.

Advertising

Use this information to make informed decisions when deciding on your salary requirements. But don’t limit yourself to the average salary range. Companies will usually pay you more for the value you have.

Big companies will often pay more than smaller ones.[3] Whatever your desired salary amount is, always ask for a higher amount. Employers will often reject your initial offer. In fact, offer a salary range that’ll give you and your employer enough room to negotiate.

7. Get compensated by your value

Asking for the salary you deserve is an art. On one end, you have to constantly invest in yourself to offer massive value. But this isn’t enough. You also have to become a great negotiator.

Imagine requesting a high salary and because you bring a lot of value, employers are willing to pay you this. Wouldn’t this be amazing?

Most settle for average because they’re not confident with what they have to offer. Most don’t invest in themselves because they’re not dedicated enough. But not you.

You know you deserve to get paid well, and you’re willing to put in the work. Yet, you won’t sacrifice your most important values over a higher salary.

The bottom line

You’ve got what it takes to succeed in your career. Invest in yourself, learn how to negotiate, and do research. The next time you’re asked about your salary requirements, you won’t fumble.

You’ll showcase your skills with confidence and get the salary you deserve. What’s holding you back now?

Featured photo credit: LinkedIn Sales Navigator via unsplash.com

Reference

Read Next