Hey, Millennials, invest those tax refunds
Message to Millennials: Your tax refund could make you rich one day.
Cash-strapped young people looking to jump-start their savings should view their IRS refund as a key source of investment seed money. Paying off debt with that money is another option, of course, as is splurging on a vacation.
But Millennials in search of financial motivation should consider this statistic: Plowing the average tax refund of roughly
$3,000 into shares of three popular stocks — Amazon, Apple and Netflix — over the past 10 years would have turned a
$30,000 investment into nearly $220,000, according to an analysis by Rubicoin, a digital educational investment platform.
That six-figure savings balance is “enough to pay off student debt, credit cards and much more,” the study authors note.
“The takeaway is that anyone, regardless of their financial knowledge, can build long-term wealth by taking just a few positive steps in the right direction,” says Emmet Savage, CEO and co-founder of Rubicoin. “When someone receives a windfall like this — a few thousand dollars that they previously didn’t have — it’s easy to spend it on something that is instantly gratifying like a holiday or a new TV. Making the decision to forgo that in favor of long-term financial freedom isn’t just possible, it’s actually pretty simple.”