If you’re set to receive a year-end bonus or a tax refund in a couple of months, what will you do with this money? Should you invest it or pay off debts?

If your cash flow is strong, you might want to invest the extra money. But if you are just getting by, possibly due to high-interest loans, you might be better off reducing your debt load. For the future, you might be able to help control your debts by building an emergency fund, with the money held in a liquid account, to pay for unexpected costs.

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You’ll also want to evaluate which debts to tackle first. Instead of making extra mortgage payments, you might want to pay down high-rate consumer loans whose interest cannot be deducted from your

taxes. If you can invest your extra money, look for timely opportunities. For instance, you have until April 15, 2019, to fully fund your IRA for the 2018 tax year.

When you do get a bonus or tax refund, think carefully about what to do with the money. It will be time well spent.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

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