Debt Reduction Advice | Debt Reduction Advice

Sure a new dishwasher, flat screen or spa weekend would be nice, but what about using that tax refund to pay down debt? That’s the plan for plenty of Americans, according to the National Retail Federation. Every year the organization polls Americans to see what they’re really going to do with that tax refund. And this year a big chunk of taxpayers say that check from Uncle Sam will go towards paying down debt. Here’s how the numbers break down:

• 44% of Americans say they expect to use their tax refund to pay off debt.
• 40% of taxpayers plan to sock their refunds away in savings.
• 29% will put it towards everyday expenses like house payments, car repairs and utility bills.
• 10% will take tax money and use it to go on vacation.

Using your tax refund to pay down debt can be a good idea– especially if you’ve got lots of it and your interest rates are high. But fewer Americans are using their tax refunds for this purpose as compared to last year, according to NRF. In 2009 48% of Americans surveyed said they would use money from filing tax returns to pay down debt. Some of this difference could be because fewer Americans are actually expecting a tax refund this year. Last year 68.4% of taxpayers polled were expecting that extra money, but this year that’s down to 65.5%.

Since the NRF has retailers’ best interest in mind, they’re hopeful that more Americans will hit stores to spend their refunds. Even though the bulk of people plan to put at least some tax refund money towards debt, the NRF is predicting that shoppers will be opening their wallets with more ease than last year. “A little bit of ‘free money’ will go a long way for Americans this year,” Tracy Mullin, president and CEO of the NRF released in a statement. “Retailers planning special promotions over the next few months may find that shoppers are a bit more receptive to opening up their wallets than they have been for the past year.”

What do you plan to do with your tax refund?

Using Your Tax Refund To Pay Down Debt is a post from: Thistle Debt Consolidation