Whatever you spend it on, your federal tax return can be a big boost to the nation's economy. Car dealers, furniture stores and other retailers...
Whatever you spend it on, your federal tax return can be a big boost to the nation’s economy. Car dealers, furniture stores and other retailers welcome that “free-money” mentality because they say business can jump by as much as 15 percent as a result of income-tax refund money.
A poll of 1,004 consumers by TrueCredit.com and Roper Public Affairs found 41 percent of taxpayers who responded would use their tax return to pay credit-card, mortgage or other bills.
About 28 percent said they would buy something they need and 26 percent would save the money. Only 9 percent said they would splurge and buy something fun. The figures add up to more than 100 percent because some people gave multiple responses.
Some experts, however, disagree and say the majority of people, as high as 80 percent, would spend, not save, their tax returns.
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Taxpayers are getting back an average of $2,167, which is up 3.7 percent from $2,090 in 2004.
Experts say the best thing to do with your refund is take care of debts, but they realize not everyone is going to heed such advice.
“With interest rates rising, consumers are paying more attention [to finances],” said John Danaher, president of TrueCredit.com. “The average consumer owes $8,400 in credit-card debt, … so it makes sense to use a tax refund to reduce their debt burden.”