Personal Finance: Tax Refunds to be Spent En Masse this Year ...

According to Capital One Bank, most Americans who receive a tax refund will promptly spend it in some form or fashion this year. The average refund, which has been estimated at $2,913, will go in many cases to ?everyday expenses? (28 percent), while another 28 percent of those surveyed plan to make a major purchase like electronics, a vacation, or new clothing and accessories[1]. A little less than a third of those surveyed reported a plan to save ?at least part of the money,? however, while 17 percent anticipated paying down a debt and five percent intended to invest the funds.

Interestingly, 69 percent of all Americans do not calculate their tax refund or tax payment into their annual budget, the survey showed. And those who owe taxes do not appear to be planning ahead much either. Only 25 percent have money set aside specifically for taxes, while 19 percent will work out a payment plan with the IRS. 32 percent will pay up front, but will have to dip into personal savings to do so. [2]?Tax season is a good opportunity for people to plan ahead,? one financial planner pointed out, adding that tax refunds represent ?a good opportunity for people to plan ahead with an eye toward their future goals and financial health.? This is the second year in a row that this survey has indicated that a third or more of Americans plan to spend part or all of their refund.

How do you handle tax season? Does this survey reflect your tax habits?

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[1] http://www.bankinvestmentconsultant.com/news/Most-Americans-Plan-to-Spend-Their-Tax-Refunds-2677966-1.html

[2] http://www.marketwatch.com/story/a-third-of-americans-plan-to-spend-all-or-part-of-their-tax-refund-finds-capital-one-bank-survey-2012-03-20

Category: Financial Markets, Real Estate, Retirement Planning

Source: http://investing.bryanellis.com/1351/personal-finance-tax-refunds-to-be-spent-en-masse-this-year/

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