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Planned Use of Tax Refunds
Breakdown of how taxpayers plan to allocate their refunds this season.
Primary Sources
TurboTax: How Americans Plan To Use Refunds | GOBankingRates
FG Trade Latin / iStock/Getty Images Commitment to Our Readers GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology. 20 YearsHelping You Live Richer Reviewed by Experts Trusted by Millions of Readers Most Americans expect a tax refund this year — and many are counting on it. A new TurboTax survey found that nearly 7 in 10 Americans (69%) expect a refund, with most planning to use the money to shore up savings or cover everyday expenses. Here’s a closer look at how Americans are planning to use their refunds, and how to determine the best way to use yours. Many Americans Plan To Put Their Tax Refunds Into Savings The TurboTax survey found that 44% of Americans plan to put at least some of their refunds into savings. Lisa Greene-Lewis, CPA and tax expert for Intuit TurboTax, recommended utilizing your refund to pay off any high-interest credit card debt first, and then putting at least some of what you have left over into a savings account — especially if you don’t have an emergency fund. “Putting the funds in savings is also wiser than leaving the money in checking, as savings can earn interest and you may be more inclined to spend all of the money left in your checking account,” Greene-Lewis said. About 4 in 10 Americans Will Use Their Refunds To Cover Everyday Expenses According to the survey, 41% of Americans plan to use their refunds to pay for necessities. “In a time with continuously rising costs and economic uncertainty, this is not surprising,” Greene-Lewis said. “Tax refunds have become a lifeline for many Americans.” TurboTax’s data shows that many Americans who expect a refund are using it to cover necessary expenses like rent, groceries and bills, underscoring just how stretched household budgets remain. One-Third of Americans Plan To Use Their Refunds To Pay Down Debt Finally, 35% of Americans will pay down debt with their refunds. “While many aim to save their refund or pay down debt, a majority rely on refunds for essential expenses, which is a trend we saw last year but has grown this year,” Greene-Lewis said. How To Use Your Tax Refund Wisely While many Americans have a plan for what to do with their tax refunds, the majority do not feel confident that they are...
How to use your tax refund to pay off debt, and finally get ahead
Tax season has a way of putting finances into focus.For many households, it is the one time each year when they take a close look at income, expenses and what they owe. Credit card balances, personal loans or medical bills that may have been manageable month to month can suddenly feel more urgent when viewed all at once.That shift in perspective matters.For many households, using a tax refund to pay off debt is one of the most impactful financial moves of the year, and one of the most underused. At the same time, filing requirements can surface financial obligations that were not top of mind before. Forgiven debt may need to be reported as income. Interest paid on certain types of loans becomes more visible. Monthly payments that once felt routine can stand out when compared against annual earnings.Using your tax refund to pay off debt: where to startIn many cases, tax season becomes a turning point in how people approach their debt.This isn’t just about having extra cash in a bank account; it’s about a mental shift from playing defense to playing offense. For some, a refund is the tool they need to finally wipe out high-interest credit card balances that have been stalling their progress. For others, it’s the moment to explore tax season debt consolidation, moving away from juggling multiple bills into one predictable monthly payment. And for those facing more serious financial pressure, this season is often the catalyst to stop making interest-only payments and look into a debt settlement program that can actually reduce the total amount they owe.Tax season debt consolidation: from playing defense to playing offenseEach of these paths reflects a different priority. One person may want to lower monthly payments to better manage essential expenses. Another may be focused on reducing interest costs over time. Someone else may want to create more financial flexibility heading into the rest of the year.At Achieve, we often see tax season prompt people to revisit how their debt fits into their overall financial picture for the year ahead.This annual "financial physical" often highlights the difference between simply staying afloat and actually getting ahead. We see many homeowners use this time to evaluate if tapping into their home’s equity is a smarter way to pay off high-cost debt than using a one-time refund. The real objective during tax season shouldn't just be to pay down a single balance, but to restructure a household’s finances so they are more resil...
Savings rates steady as Americans eye refunds for essentials
Tax expert Lisa Greene-Lewis advises prioritizing repayment of high-interest debt before saving, especially for those without an emergency fund.
Average Tax Refunds by State and County - citizentribune.com
The report looks at national trends in average refund size, the share of taxpayers receiving refunds, and detailed breakdowns by income group, state, and county — offering a closer look at where ...
