I spent the afternoon getting documents ready for our new accountant. We have always done our own taxes online, but 2010 had just enough quirks to justify getting some professional help.
For many years I looked forward to our tax return (we almost always get one) because it felt like a big bonus check! But when we started paying off our debt I realized I didn’t want a big bonus in March, I wanted more money every month to pay off our debt! We upped our withholdings and had less money taken out every month. We still usually end up with a small refund but it is nice to be able to have our money to spend or save throughout the year.
Now that we are debt free (except the house) our small refund will probably go towards the house. For years I looked forward to spending our refund, but now I try to make our refund work towards our financial goals. If Uncle Sam is going to force us to save money throughout the year by keeping it, I mind as well put it to good use when I get it back.
How about you? Do you spend or save your refund… or are you writing a check to Uncle Sam this year?
We’ll spend about half and put the rest in savings. Part of my quarter (lol) will be going into fabric and other diaper making supplies (aplix, elastic, and thread), and I hope to get an iPhone. DH wants to start saving for a house, and so do I, so all the extra will go into a special savings account for that goal!
We usually use ours to make big purchases. This year it’s going to cover my husband’s vasectomy reversal!!
All of ours is going to pay off bills. It’s kind of sad that we aren’t going to have any extra for something fun, but hey we will be debt free. Thank goodness! I am so tired of our paychecks going to bills. No more buying it if I can’t pay cash or pay it right off!
We are getting a nice chunk of change since we get the full child tax credits and earned income credits.
Most of it is going directly to my midwife to pay for the upcoming birth of baby #3, but after the baby is born we will get about $2000 back from our insurance. I hope to use it towards debt and/or emergency fund, depending on how much $ is in the e-fund at that time.
Our year was a roller coaster, so we’ll be getting a chunk of change. I normally don’t like that, but it is what it is. We’ll be setting aside half of it for moving expenses this summer, as I may have to get an apartment and come up with deposit/first month’s rent. We’ll have a nice date (dinner at a nice restaurant with a restaurant.com gift certificate and maybe a movie or something), and throw the rest at paying off our car.
I think it’s important for us at this stage (almost done paying off debt) to remember that money can be fun, too! We just need to not let a fun purchase (date night or whatever) trigger the slippery slope of spending.
It depends on the year for our family. In the past, we have used the money to pay off debt. We were able to pay off our six-year van loan in three years thanks to the IRS.
We have also cut a substantial amount of time off of our mortgage while saving a good deal of money that we would have had to pay in interest. All of the money you can throw in on the front end saves a huge amount in the long run. However, last year, we saved out tax return because we will likely need to purchase a larger vehicle in the next couple of years, and we’d like to be able to pay cash.
That’s awesome TJ! Life is better when you are debt free and it will be nice to get your tax return next year and not have to put it towards debt!
Toni
Elizabeth,
In your case saving for that big van is probably a good idea. No doubt you’ll need one in a few years.
We use our refund to pay any bills that have backed up (due to having an autistic child) and invest in auto and housing repairs/improvements. I give more details into my ideas here: http://www.pennysaved-pennyearned.com/blog/2011/01/tax-time-your-refund/. Sorry if that is spammy. I don’t intend to be.
We will be spending it, but not in a fun way. New roof, new tires for the van, and a credit card to pay off are the kill joys this year. Next year we may need to purchase a newer vehicle for hubby and an animal trailer.
We will be saving ours this year as the only debt we have is our home and some student loans. But we will hopefully be fullfilling our dream this summer of moving to Colorado. So we will just be saving as much money as possible between now and then.
Not spammy at all! Thanks for sharing.
We usually put the money toward our house payment or as a “bonus” for our travel savings fund. We just have the house as our only debt and really hope to be done with that in the next few years!
I say good investment Heather. We did that 1 year and now have 2 more children from the result!!! Good luck!
We have just finished paying off our credit card debt so we plan to put most of it towards our car loan.
We are buying a house this spring after living in a rental for a year so we could move as a family. So I am pretty sure that the tax return will go towards some repairs and improvements we would like! Like a new washer and dryer! And probably a new bookshelf – we have a LOT of books!
We usually get a really good return, and my husband usually gets a big boy toy (he is into music, so usually its the newest mixer or sound board). This year we made the decision to finally get us out of debt…but when he realized no more would be left this grown man literally pouted like one of our kids…it was so cute…i told him we would save up for that flat screen he wanted so he could get it for his bday…hey the art of compromise:)
In the past, as a single gal, I always saved it… This year, I think my husband and I have decided to put it toward our car loan to help us get debt free (hopefully!) by the time Baby arrives in June!
We usually use it to pay down debt & spend part to do something fun. This year our refund is so small, we are throwing it directly into savings to help with deposits. We are moving to a rental house that’s almost double the size of our tiny apartment 2 weeks after baby #3 is due.
This year I’m paying off debts, saving & spending some, fixing the car & put a little towards the house.
We usually spend it but this year we are saving it all hopefully. We usually pay car insurance and renters insurance for the year. we also save the money for our medical and dental bills.
We get a big refund from Earned Income and Child Credits. I use some of the money for next year’s homeschool books. The rest is going into our Emergency Fund until we have six month’s of household expenses in savings.
Ours this year will be used for fixing my truck, fixing my washing machine, catching up some bills(hubby’s only worked 1 full week since the beginning of this year because of snow), buying the crew some clothes, stocking back up on stuff, putting the deposit on son’s braces(insurance wont cover them, eck!) and getting the oldest a new pair of glasses, IF there is anything left over, I’d like to get a couch
Every year we use our refund to pay down a huge chunk of our debt. After 6 years of me doing it, and 4 years of me and hubby collectively throwing the money in, we are (this year) down to a vehicle loan and our mortgage! No savings yet, but we plan on having the van paid off by next tax season, and then starting a savings account. It has been such a relief!
The last few years we saved them so we could buy our first van and also put aside some for living (my husband was a grad student, and we had three children). This year, he’s working, and though our only debt is his student loans and a house that just won’t sell (that we aren’t living in because his after grad-school job took us far from it), I think I’ll plunk it all towards that student loan debt. I’d like to have no debt, so we’ll pray the house sells and work hard at the loans.
We used our the last few years on cars – we always buy used, and two of the three years were purchasing newer vehicles to replace two falling-apart cars! The third year it was a new transmission for our van. This year, we are: paying off a home improvement started in the fall (which needs to be finished up), paying down a few overdue bills (like heat and electricity), putting a bit away for savings/medical needs in the coming year, and getting a new non-leaking dishwasher.
If there is any left over, my hubby’s vehicle from last year came with a broken window (it’s electric, and won’t go down) so we want to fix that before summer hits and we can’t open it at all. So, nothing too bad! 
I personally am awful at saving – that’s my goal this year, to get better at it – and so I look forward to getting a big check in the spring so I can actually put a bit away. And keep it. 
This year we had to replace our roof because of a storm and insurance covered it but not the rotten decking underneath, so we’re paying that, and snowballing a couple of small debts with the rest. I want to save the rest, but hubby says snowballing is better. What do you think?
Since my husband has been self-employed for 22 years, we always have to send a check. Rarely have we received a refund. However, we are savers as a rule.
Well this year, we received a little extra because of our new baby. But we will need to SPEND! We will save a bit of it, but it will go into our emergency fund, but thats the only type of saving we will be doing. The rest of the return, will be used to pay off some bills, and to get him a special valentines day gift.
nice to hear my husband had his done in September not pregnant yet but hopefully someday.
The majority of my refund will go towards my car loan. This will cut my balance in almost half. Whats left will cover the amount I owe my state and cover a surgery my dog is having. Since I don’t have children, he is my kid and well worth the money.
I would snowball it, but that is just me.
AWESOME! Debt free is a great place to be! Congrats!
This year we are going to keep it in an account that we have set aside for our deductibles. Last year we didn’t have anything set aside just for our health insurance deductibles and it proved to be a tough year. This year we are getting back just enough to cover all of our deductibles, maybe even enough to cover our car insurance deductibles too!
I’m hoping to get enough back to pay off my husband’s car loan and maybe even get new gutters for the house.
We will pay off my older son’s private high school tuition. Then pay off most on the credit cards. Renew our home warranty (This really came in handy this past year… the AC coil was rusted and all we had to pay was $60 for a service call to have it replaced and the freon recharged) The rest goes into savings then once a month we move half a mortgage payment to checking and it helps us to stretch the monthly budget bc we are not using and entire paycheck to pay off household bills….
We apply to our yearly life insurance payment (rather large since we had a pre-existing condition), help out some charities/missionaries with a one-time gift (easier than making monthly contributions for us), pay an extra chunk on our mortgage principle payment (hoping to pay off mortgage 12 years early!), and the rest to savings (and maybe a little splurge/fun money)–a girl’s gotta have some fun!
Great topic!
I see so many people (especially on Facebook) who think that their Tax Refund check is some type of “free” “party” money. Well, for some it is! But for others it is YOUR money that you merely loaned to the government interest free!
My suggestions are if you are getting a big refund – adjust your withholdings for the next year so you can have YOUR money now! One of these days, the government may not have the cash to refund YOUR own money back to you. So keep as much of it NOW as you can!
My vote is treating it like you would any of your additional income…don’t go on a spending spree…use it for things you NEED or save it for your emergency fund!
What a great topic!!!
I just stumbled upon this website and decided to check it out and am glad I did. I’m 24 years old and sadly to say I already received and spent my tax return on catching up some bills and some things that I financially haven’t gotten around to like training classes for my new puppy and the rest as am embarrassed to say was spent on STUPID things that honestly I can’t even tell where it all went to. But listening to you all have inspired me to do much more with next year’s refund and be a lot wiser in how and where I put my money. I am now setting goals for myself for savings and becoming 100% debt free.
Thank You Ladies : )
Hubby and I bought a car about 3.5 years ago back when we were both working and making…well, much more than we are now. We took out a loan for 6 year and then refinanced it a few months later to make it a 5 year loan. We’ve been using our tax refunds for the past few years to help pay it down. This year we were excited that we didn’t need the whole refund for our loan!!! We only had about 3 payments worth left to pay! Horray! We got our refund in February ( I told my hubby I was getting right on it, because every day that we had to wait for it to some and then pay our loan meant more interest). We paid off the car, then paid off another of my school loans! Hooray!!! Sad, that I still have 4 more…but gotta do what ya can! Also was able to put some into our longterm savings and into the separate account that we opened for our son that we try to put $100 in each month (we were behind…so it was basically just catch up time). We still had some leftover that we had to use for other little things….but in the end, we felt good about getting two big things paid off and money in the bank! We gave ourselves a nice pat on the back for a great job!