Best practices for your tax refund

How Will You Spend Your Tax Refund?

If you’re waiting for a tax refund, chances are you already have some ideas of your own. For the past few years, the average tax refund in the U.S. has been around $3,0001. That’s a sizeable amount for most of us, but before you spend it all in one place (like a dream vacation), you might consider other options that could be better for your finances in the long run. After all, your refund is not free money from the IRS. It’s your money being given back to you.

A recent Edward Jones survey2 found the following about how respondents planned to use their tax refunds this year:

- 52% — Necessary items like groceries or credit card bills

- 30% — Save

- 8% — Something fun

- 8% — Investments

- 2% — Not sure

 

Though we don’t really know what people actually do with their refunds, maybe their stated intentions are a good place to start with suggestions.

 

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