Wealthsimple’s portfolio managers share their expert advice on what to do with that chunk of change you just got from the government (hint: don’t get a tattoo).

Tax refunds. What’s better than a tax refund? The average one is about $1,600 and a good share are much bigger. For a lot of people, that’s the biggest chunk of discretionary income they’ll see in a year. The question is: what to do with it? There’s a lot of pressure. There’s even more temptation. If you’re like most of us (i.e., a human being) you may be having visions of all the stuff you could buy, do, eat, drive, or text on. But what’s really going to make you happy?

(If your answer is “a gold-plated hoverboard!” then we have no hope for you.)

To get some advice we talked to two learned money experts: Andrea Coombes, an investing and retirement specialist for NerdWallet, who’s spent 16 years helping people manage their finances better; and our own Michael Allen, Wealthsimple portfolio manager, who helps design our clients’ money strategies.

First rule? “The most important thing is get it out of your chequing account,” Coombes says. Not only are you earning terrible returns, but “that’s the best way for it to disappear without you even realizing it.” And after that? Here’s our four step plan.

#1 Wipe Out Your High-Rate Debt

If you’re paying double-digit interest on anything — credit cards often come with rates of more than 18% and some student loans can be particularly brutal, for instance — use your bonus to pay that debt off before you do anything else. Michael Allen advises Wealthsimple clients to pay off any debt with a rate higher than 5%.

And keep an eye on your overall debt as well. “We recommend our clients keep a debt to income ratio that’s no more than 2.5:1,” Allen says. So multiply your income by 2.5 — if that number is smaller than the outstanding debt you have, it’s probably a good idea to pay it down.

#2 Establish an Emergency Fund

Allen recommends keeping an emergency fund of between three and six months of living expenses. This will give you peace of mind in case you lose your job or can’t work for other reasons. It’s also a good idea to keep some money handy in case of unforeseen expenses — your transmission turns to garbage, your roof turns into a sieve, a tree falls on your helipad — so you won’t need to go into high-interest debt.

Where should you stash your emergency fund? Allen recommends keeping it separate from the money you use for monthly expenses — a savings or money market account with a good interest rate, like Wealthsimple’s, is perfect.

#3 Invest! Wisely! With Low Fees and a Smart Portfolio

This is important. Put your money to work! Do not buy a hot tub. Do not have the world’s most famous tattoo artist needle a portrait of the Buddha onto your back. Do not book a trip on a zero-gravity space flight with Richard Branson. Instead, let your money grow over the long-term. Preferably in an investment portfolio that’s low-cost, diversified, and doesn’t rely on a human who thinks they’re good at picking stocks (historically, humans are not great at beating the market when it comes to returns). A good example would be, ahem, Wealthsimple’s investment portfolio — as a TurboTax customer you’ll get a $50 bonus when you open a new Wealthsimple account (min. $500 deposit). Click here to check us out.

“One of the most amazing assets you can have — and you ignore at your own peril — is time,” says Allen. So waiting to get started gets very expensive.

Where to begin? The first thing to do is max out your tax-advantaged retirement accounts such as a TFSA or RRSP.

And if you’ve already maxed out your RRSP or TFSA, move on to an individual investment account.

#4 Spend it! Some of it. If You’re Into That

You can always buy something — an experience, a piece of art you’ll have forever. Money should be used for enjoying your life, after all. Even portfolio managers know that. Allen suggests as long as you’re not dealing with major high-interest debt, blowing a portion on something fun is acceptable.

And you know what’s a good time? A socially responsible investment portfolio! It’s great for parties. At least if you party with Wealthsimple portfolio managers. Which you should. They’re fun.

Lastly! If you decide to invest your refund, or even if you don’t, you’ll get a $50 bonus as a TurboTax customer when you open a new Wealthsimple account (min. $500 deposit). Click here to get started.