7 Tips For Turning Your Tax Return Into Even More Money
Side hustles you can start with just a few hundred dollars!
Every year around tax season, entrepreneurial minded people try to think of ways to use their tax refund money to make more money. Black millennials, who are masters of side hustles, are no different.
To help you use that money to make some money, here are a few ideas on how to use your tax refund for entrepreneurial purposes:
1. Start an Online Store
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Photo Credit: SRG Finance
The skies are the limit with online businesses! Almost 80 percent of Americans shop online and that's just the U.S. Imagine how many customers await around the world!
With a small startup budget for inventory, marketing and administrative costs, you can sell a product to anyone worldwide via marketplace sites like eBay, Amazon, Etsy and Craigslist.
For aspiring clothing designers, craftspeople and other creators who have manufactured a product, sites like Big Cartel, Squarespace and Shopify are good choices.
With a great eye for what people want, a few bucks for marketing, a social media following and a website you can set up shop online and start generating a consistent income without rent or lease costs that weigh down with brick and mortar businesses.
Minimum Estimated Startup Cost: $100-$5000
2. Buy a home & turn it into a rental property
Photo: Columbia Pictures
Real estate will always be one of the most viable investments you could make because people will always need a place to stay. Throughout the nation, cities hold auctions for real estate properties starting low as $500. Be sure to have a plan for renovations and unexpected costs like emergency repairs. Once those things are taken care of, real estate could take you into a world of generational wealth.
If the start-up costs seem daunting, find a partner, or two or three to spread the risk and lighten your load. Just bear in mind that you'll also have to split the wealth.
Minimum Estimated Startup Cost: $500-$5000
3. Turn your trade into a business
Are you good at doing hair? Nails? Handy work? Tax preparation? Any skill you have can be turned into a hustle going into the future. Use your tax refund to buy supplies, equipment and to pay for marketing. Leverage social media to gain exposure cheaply. Just make sure you actually have the skills to pay the bills.
Minimum Estimated Startup Cost: $100-$1500
4. Become a Media Star
Photo: Tribeca Film Festival
If you are a creator (rapper, singer, comedian, educator etc.) you can use some of your tax refund to build a media platform to display your talents. All you need are social media accounts. With a YouTube channel, a high quality camera, and fan engagement through platforms like Twitter, you will position yourself to gain exposure and (maybe) blow up.
Be aware that this route takes time and persistence. If you want immediate returns, this probably isn't for you.
Minimum Estimated Startup Cost: $100-$2000
All that being said, you know and I know that having money in our pockets can sometimes lead us to make questionable decisions. So, what shouldn't you do?
1. Give money to a con artist
Photo: Getty Images
Your cousin may come to you and tell you he can flip your money a few times. But did he successfully slip his own? Your Instagram follower might tell you that she can turn your $500 into $5,000 in five days. If she was really a financial wizard, wouldn't she be too busy to comment on your pictures of your lunch every day?
Your chances of having a positive return on investment are much greater taking a real entrepreneurial risk than investing in these types of schemes.
2. Pay off ALL of your debt
Photo: CBS News
There's a high probability that your current debt (student loans, credit card and car payments) may far exceed your tax refund returns. Therefore, instead of handing over your entire check to debtors, set up a payment schedule, paying your debts off in installments. This will give you more financial breathing room in the months to come. And, you could even use the money you usually set aside for bills to start your business.
3. Save it all
Photo: The Register
One of our greatest financial minds, Warren Buffett, has said, “money is the worst investment anybody could have!”
We can't ignore the need to have cash on hand for emergencies, but if you believe you're helping yourself by cashing your tax refund check, putting into a saving account (or under the mattress) and leaving it alone, you believe wrong. Very wrong. Real hustlers are going to always have some money invested, because investing is the only way to turn that money into more money.
So there you have, my fellow black millennials. It's not just about having money, but putting the money you have to good use. With careful planning, anyone can create an entrepreneurial opportunity out of the stimulus of funds we receive every year for tax season. Use that money wisely will bring you one step closer to financial freedom and happiness, just like these guys.