In today’s Express, there is a little blurb that states that 47 million tax returns have been filed so far this year, 38 million of them filed electronically. The shocking part of the blurb? The average refund was $2708! That is an amazing amount of money to be overpaying in taxes. Of course, I’m sure the refunds are in large part due to various deductions, but I was delighted to find out that I was getting nearly $500 back (to counter the nearly $800 I paid to two states).
I know that a lot of people like the idea of a refund, but personally, I’d rather have to pay the government at tax time. Ideally, I’d break even (which I feel I got very close to this year). But I would prefer to have the money when I earned it to do with it what I want, rather than get it back later and have given the government that large of an interest free loan.
Just my opinion though, and I know there are strong proponents of large refunds. I bet it is fun to find that amount direct deposited in your account one morning.
Megan is a 30-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.
I’d like to break even, and I expect to do just that once I get out of school. But I am going to miss the refunds I’ve been getting back for my tuition. 🙁 Then again, I won’t be paying tuition anymore so that should even itself out, hehe.