Free Money Finance - on tax refunds, investment, increase retirement

Free Money Finance

---

Average Tax Refunds Posted: 15 May 2013 01:29 AM PDT The Wall Street Journal lists the average tax refund as follows: Income: $25k-50k; Average Refund: $2,774 Income: $50k-75k; Average Refund: $3,051 Income: $75k-100k; Average Refund: $3,657 Income: $100k-200k; Average Refund: $4,704 I'm wondering if these are too high or not. On one hand, it seems like a lot of money that's "loaned" to the federal government each year. The people making $25k a year are shelling out too much -- to the tune of 10% of their income (unless their refunds are based on earned income credits and the like which they don't have to pay for). On the other hand, if you make $150k a year, $5k probably isn't that much off. You probably have a whole lot of tax issues to deal with and getting closer to $0 is difficult to do. We owed money this year, so I guess the government gave us a loan. :) It seems to run in cycles depending on my annual bonus as well as (lately) investments in real estate -- we owe one year, then get a refund the next. No real pattern that I can see. What's also interesting is what they say to do with the refunds: 1. Pay off your credit cards 2. Take a course 3. Increase your 401(k) contribution 4. Pay down your mortgage 5. Gamble on … Italy (Invest) Can't say I disagree with any of these, though the last one seems like it was added to be "cute". Personally, I'd go with a stock index fund from Vanguard or save the cash to be used for investment in real estate. What's your take on these numbers? Too high or are they "ok"?

You are subscribed to email updates from Free Money Finance To stop receiving these emails, you may unsubscribe now.	Email delivery powered by Google
Google Inc., 20 West Kinzie, Chicago IL USA 60610