Just over 50 percent of Americans anticipate they will receive a refund on either their federal or state income tax return this year, according to a new survey, and of those 63 percent said they plan to save or invest at least part of the money.
The survey, by TD Ameritrade, found that only 14 percent of the respondents who expect to get a tax refund this year said they would spend the extra money on luxuries like traveling or buying a brand-new cell phone. Approximately half of the respondents said they would instead use part of their tax refund to pay down debt or for necessities like food or utility bills.
"While this pragmatism may be a result of current economic conditions, it's nevertheless good to see that people are more likely to save their tax refund rather than perhaps spending it unwisely," said Lule Demmissie, managing director of investment products and retirement at TD Ameritrade, in a statement. “Contributing lump sums like year-end bonuses or tax refunds is one way to bolster a retirement account.”
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