If you’ve noticed a little bit extra in your weekly or fortnightly pay since the start of the new financial year, there’s a reason for it.

Most of us got a tax cut from July 1, which for many taxpayers will mean a few hundred to a few thousand extra in your bank account each year. You can calculate what your tax cut will look like here (link).

If you’re an employee, it’s important to check your payslip to make sure your employer has passed on the tax cut.

Lots of young people are struggling with the higher cost of living at the moment, so a bit extra each week, fortnight or month is likely to be welcome. However, there are also ways to put the few hundred to few thousand extra towards the future. Here are some ideas.

1. A high interest savings account

With interest rates on the higher side at the moment, savers are being rewarded for putting regular money into the bank. If you’d like to save the money you were paying in tax, consider looking into different savings options and picking one that works for you.

2. Paying off debt

If you’ve got credit card, payday lending, buy-now-pay-later or personal loan debt, you may wish to consider using your tax savings to chip away at it. A good start is working out how much extra you have in your account each month and trying to direct that towards debt.

3. Getting started with investment

Investing is a way of building money over the longer term and these days, you can get started with a smaller initial investment. Here’s an intro article (link). Remember to consider your goals and the potential risks and speak to an expert, such as a qualified financial adviser, if you need extra help.

4. Working towards a goal

Are you planning a holiday? Or wish to buy a new car? Putting away your extra tax savings each week, fortnight or month could help to build a fund for your next big goal. A separate savings account may help here too.

Like every article on this website, this is not personal financial advice.