Author Topic: Wasting tax refunds  (Read 34586 times)

Fonzico

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Re: Wasting tax refunds
« Reply #100 on: March 28, 2014, 02:42:32 PM »
I have definitely been guilty of  this in the past... usually tax refunds were used to pay off the credit card, which I suppose was better that spending it, but also indicative that the card was carrying a hefty balance!

Last year, most was set aside for a vacation, and the rest was put towards credit cards. This year, there is no credit card balance, whoohoo! The refund will go towards shoring up the emergency fund, and investing in our business. Next year, hopefully there will not be enough of a refund to worry about. :D

NinetyFour

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Re: Wasting tax refunds
« Reply #101 on: March 28, 2014, 03:40:21 PM »
I'm sure that in my younger days, I didn't always use my refund wisely--nor did I understand the wisdom of not getting a refund in the first place.

This year, I didn't think I would get a refund, but then I hired a CPA and, through his wizardry, I received $3500 in refunds.  Yay.  Oh, and a bill for $250, which I gladly paid.

$2000 of my refund went to my mortgage.  $1000 went to my TIAA loan.  The rest is sitting in my Capitol One savings account.

SpeedReader

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Re: Wasting tax refunds
« Reply #102 on: March 28, 2014, 10:09:13 PM »
In the Pre-Mustachian Era, I'm sure I blew it on clothes, eating out, and other miscellaneous crap with nothing to show for it.  Now it's usually to fund DH's Roth IRA for the year, or goes to the vacation fund. 

Thespoof

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Re: Wasting tax refunds
« Reply #103 on: March 30, 2014, 04:47:45 PM »
I never used to get tax refunds - I do now though. I take my substantial RRSP refund and use it to make the max yearly contribution to my TFSA. The left over goes back into my RRSP. Once I've used up all my contribution room in my RRSP (ways to go yet!) I'll likely through the rest into a taxable account since RRSP and TFSA will both be maxed.

jenstill

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Re: Wasting tax refunds
« Reply #104 on: March 30, 2014, 05:05:22 PM »
I'm very excited to receive my tax refund this year. I will finally be able to pay off the last of my consumer debt! When I found MMM, I had a couple credit cards, car payment, some financed home improvements, and "care credit" card for all the kids' glasses, dental needs, and other medical stuff. I've been working really hard on getting it all paid off -- while upping the contribution to my 401k -- and this will be the last payment; feels great! Now, on to student loans.

Paul der Krake

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Re: Wasting tax refunds
« Reply #105 on: March 30, 2014, 05:10:17 PM »
Aaron's. the infamous rent-to-own BS chain, is flooding mailboxes with their tax refund specials right now. Urgh.

It's so shady that they don't even list prices on their websites, they give you quotes after you enter all of your info on their online form.

MrsPete

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Re: Wasting tax refunds
« Reply #106 on: March 31, 2014, 05:27:08 AM »
I usually owe a few bucks, but here's a good story:

My cousin is, well, a trainwreck of a human being.  That's being nice about it.  She's got problems, like serious problems, and small children to support.

Anyway one year, with some tax credits, they managed to snag a SIX THOUSAND dollar refund.

We were all happy thinking she could finally get her house repaired, buy her kids some things for school, have some savings, pay medical bills...

Nope.   They got the return on a Friday and it was gone before Monday.  They still have the 60" TV...
Maybe we have the same cousin . . . mine was out of work for months, was behind on all his bills, was going over to our grandmother's house (though he'd pretty much ignored her previously) because he knew she'd feed him.  FINALLY he got back to work, and what did he do with his first paycheck?  No, he didn't catch up his electric bill or buy the kids shoes . . . no, he caught up the cable TV bill!  That was the thing he wanted most, had missed most.

MrsPete

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Re: Wasting tax refunds
« Reply #107 on: March 31, 2014, 05:28:55 AM »
I always spent $100 on fancy cheeses and the rest for credit card debt :(

My first year without any CC debt, I will open a Roth IRA, but I will still spend $100 on fancy cheeses! :)

You're speaking my language, friend!

Money spent on cheese, is money well spent, IMHO.

;)
Have you ever made homemade cheese?  It isn't all that difficult, though it is an all-day process, and you must be very exact with your temperatures.  The really difficult thing is that you must allow your cheese to sit for months before you can taste the fruits of your labors. 

El Limon

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Re: Wasting tax refunds
« Reply #108 on: April 11, 2014, 06:32:53 AM »
Here's a good one. My sister gets a huge EIC refund every year for being a single mother with a bad job. Two years ago she spent a few hundred on a large tattoo that she hated. This year, she spent over a grand on a cover up job for the old tattoo. Thanks taxpayers! She'll spend most of this April taking selfies of her back and shoulders, but the rest of the year dropping hints that she has no money to buy my niece school supplies or shoes.   

frugalamber

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Re: Wasting tax refunds
« Reply #109 on: April 11, 2014, 07:51:39 AM »
I never used to get tax refunds - I do now though. I take my substantial RRSP refund and use it to make the max yearly contribution to my TFSA. The left over goes back into my RRSP. Once I've used up all my contribution room in my RRSP (ways to go yet!) I'll likely through the rest into a taxable account since RRSP and TFSA will both be maxed.

We do the same; almost caught up with the RRSP contribution room. Use the RRSP refund to fund the TFSA. This year the rest may go to our home improvement project as well.

zolotiyeruki

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Re: Wasting tax refunds
« Reply #110 on: April 11, 2014, 08:08:14 AM »
Thanks to having 5 kids and lots of deductions, we got close to $3k in tax refunds this year, after paying zero withholding.

We put it into our "short term savings"--that's what pays for infrequent expenses, like car insurance and Christmas, as well as things we're saving up for, like an 8-passenger minivan for when #6 is born.  It sure doesn't come close to the amount we pay in FICA, but it does take the sting out a little bit.

lexie2000

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Re: Wasting tax refunds
« Reply #111 on: April 11, 2014, 09:24:04 AM »
We are getting an unusually large refund due to a somewhat unexpected write off this year (business loss).  For the first time ever, I decided to use a CPA because I wanted professional verification.   After he had finished our taxes and called to let us know the outcome, I asked him if I was going to need candy (there were bowls of candy everywhere in the accounting office and I asked about them - he told me that you'd be surprised how many people will go for the candy bowl when they get bad news...LOL).  Anyway, he said, "No, you will be able to take a very nice vacation or buy a car."  I guess that's what people do.  Obviously, I'd rather not had the loss in the first place.   The refund will be going directly into our taxable investment account. 

For the current tax year, there will be no refund at all; we'll probably owe a little - we're filing 1040ES quarterly to cover taxes on a Roth IRA conversion.

nicknageli

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Re: Wasting tax refunds
« Reply #112 on: April 11, 2014, 02:03:23 PM »
Here's a good one. My sister gets a huge EIC refund every year for being a single mother with a bad job. Two years ago she spent a few hundred on a large tattoo that she hated. This year, she spent over a grand on a cover up job for the old tattoo. Thanks taxpayers! She'll spend most of this April taking selfies of her back and shoulders, but the rest of the year dropping hints that she has no money to buy my niece school supplies or shoes.   

Wow.  That's frustrating.  : |

Self-employed-swami

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Re: Wasting tax refunds
« Reply #113 on: April 11, 2014, 02:31:34 PM »
Here's a good one. My sister gets a huge EIC refund every year for being a single mother with a bad job. Two years ago she spent a few hundred on a large tattoo that she hated. This year, she spent over a grand on a cover up job for the old tattoo. Thanks taxpayers! She'll spend most of this April taking selfies of her back and shoulders, but the rest of the year dropping hints that she has no money to buy my niece school supplies or shoes.   

Wow.  That's frustrating.  : |

Reminds me of some of my relatives.  One year, they bought 2 flat screen TVs with their refund, then whined less than a month later, when their super clapped-out hoopty died, and they didn't have the money to fix it.