While there will always be a debate over whether or not you should withhold enough from your paycheck to ensure a tax refund each year, the fact of the matter is a lot of Americans do just that because they look forward to getting a refund.

So if you’re getting a refund this year, the big question to ask yourself is: “What am I going to do with it?” Some tax return recipients often think of it as ‘free money.’ It can be tempting to spend it on things like high-priced clothes, televisions or electronic gadgets. But, before you do that, stop and think about it. It’s your money; you worked hard for it and why blow it on something you won’t remember a year from now? It’s far better to use some big picture budget thinking when deciding what to do.

Where do you begin?

Start by assessing your current situation by considering the following:

Debt reduction: Do you have balances on your credit cards that can be paid down or paid off? If you can’t pay them off entirely, consider applying the funds to the debt with the highest interest rate first.

Overdue bills: Are your utility bills up to date (i.e. gas, electrical, water, etc)? If not, the money could be used to get them current.

Loans: Consider making an extra payment on your car loan or home mortgage. Doing so helps reduce the amount of interest you’ll pay over the term of the loan.

Emergency fund: Create an emergency with your tax return to protect against unexpected expenses such as medical bills or vehicle repairs. If you already have an emergency fund, continue to add to it. Having an adequate emergency fund can make a big difference when the unexpected occurs.

That’s not to say you can’t splurge a little with the tax refund. Take care of one or more of the above items and hold out a small amount of money to do something fun. It doesn’t have to be big, but it should be something you or your family enjoys.

Finally, if you’re just not sure how to best use your refund, talk with a trusted banker. They can help you determine what’s best for your individual situation and refer you to tax experts as needed.

Molly Cataldo is the branch manager/assistant vice president of Citizen’s Bank of Evart.