Popular Things to Do with Your Tax Refund

Your Tax Refund

Are you someone who believes the glass is half full? Or do you think it’s half empty? If you’re in the “half empty” camp, you may very well be fretting because we’re in the middle of tax season. But those in the “half full camp” are probably smiling and making plans, because they know we’re fast approaching tax refund season. If you filed your taxes early this year, those refund checks are on the way soon and it’s always nice to have an extra boost to your bank account. Storage Quarters helps clients with record management so you can file taxes smoothly, so we thought it would be fun to take a look at popular things people do with their tax refund.

Embracing Your Tax Refund

If you’re expecting a tax refund, don’t feel guilty! Yes, we know that financial experts advise people to avoid getting refunds because it’s already your money and you won’t earn interest if the government is holding onto it. But at this point, you’re getting a refund anyway, so it’s time to embrace it.

USA Today points out that very often we don’t do financially smart things when we get the money that’s usually withheld for tax refunds in smaller sums. Even if you are disciplined, the interest you’d earn on your tax refund money will often amount to less than 1 percent. They argue that as long as you’re not running high credit card debt and need the money before you get the money being withheld, getting a tax refund can offer a strong psychological boost.

Getting and Using Your Refund

It’s important to make certain you get that refund and the IRS highly recommends that you have it electronically deposited into one of your accounts. In fact, you can deposit it into up to three accounts. Direct deposit is now used by up to 80 percent of taxpayers. The IRS doesn’t promise you’ll have your refund by a certain date. But they do say that they issue 9 out of 10 refunds within 21 days. They also give you the ability to track your refund.

So what do people do most often with their tax refunds? GoBankingRates a personal finance website did a survey in 2017 to determine the answer. They offered about 5 possibilities: paying off debt; splurging on a purchase of non-essential or luxury items; planning a vacation; putting it in savings; or making a purchase of a needed item like a car or a home. Most respondents fell into two other categories, either they didn’t receive a tax refund, or “none of the above.”

Here are the responses of those whose answers did fit those categories:

·              41%: putting the money in savings

·              38%: paying off debt.

·              11% said they’d use it towards a vacation,

·              5 % used it for a needed major item,

·              5 % used it to splurge.

Get Ready for Tax Season with Storage Quarters

Whether you’re expecting a refund or not you can get ready with Storage Quarters. We can provide document storage services for the information you need to prepare your returns and we can help you organize and retrieve everything. And if you need documents shredded, we can help with that too. To learn more, contact us today.