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Plans with Tax Refund

December 4th, 2009 at 02:29 am

I usually get $5,000.

$700 goes to State
$2000 will to buy car (long story)
$700 Pay off Credit Cards
Pay deposit for Apt
Savings

Posted in Make Money, $20 Challenge | 6 Comments »

6 Responses to “Plans with Tax Refund ”

  1. disneysteve Says:
    December 4th, 2009 at 03:18 am 1259896685
    1259896685

    If you routinely get a $5,000 tax refund, you need to adjust your witholding so that doesn't happen anymore. Rather than lending that money to the IRS interest-free all year, you could have already paid off your credit cards, bought your car and padded your savings and be earning interest on that money.

  2. wowitsawonderfullife Says:
    December 4th, 2009 at 03:48 am 1259898494
    1259898494

    I totally agree. A tax refund should not be used as a savings account. I must note, however, that many of my friends pay for their March break vacations because they do not have the ability to save.

  3. creditcardfree Says:
    December 4th, 2009 at 01:18 pm 1259932732
    1259932732

    If you (or anyone else reading this) get the Earned Income Tax Credit resulting in the large refund, you can get an advance on that money. Checkt the IRS website for the form...or your human resources dept.

  4. Broken Arrow Says:
    December 4th, 2009 at 02:37 pm 1259937431
    1259937431

    What they said above, but it's good to know that you'll be putting your tax refund to good use!

  5. financeaholic Says:
    December 4th, 2009 at 03:35 pm 1259940947
    1259940947

    i agree with what the others said above. you could be earning interest on that money instead of the government. DF and i are going to be using the majority of our refund (mostly due to the first time homebuyer's tax credit) which i am expecting to be around 9K towards paying of DF's car and the rest goes to me to do what i want with! but i might put what i get (1.5K?) into savings ... i dunno yet.

  6. DeniseNTexas Says:
    December 11th, 2009 at 02:37 pm 1260542249
    1260542249

    Count me in as one who agrees with what the others have said. You need to adjust things so you aren't loaning the govt money interest free. You need to be earning interest on that or using it to pay debt or whatever else you need! I tell my kids this, too, and they don't listen but I sure wish they would. I got about $125 back this year and was disappointed that it wasn't smaller. lol

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