These Are The Plans That Americans Have With Their Tax Refunds

Taxpayers in the United States who anticipate receiving a refund in 2024 say they already know what they will do with the funds. Most say that after they divide it up, there won’t be any money left over for savings.

Most taxpayers can usually count on receiving a refund from Uncle Sam, which may add up to a sizable sum of money for many families. In 2023, approximately 75% of taxpayers obtained a tax refund, with an average amount of $3,176.

According to a recent Assurance IQ poll, of the 72% of consumers who anticipate receiving a refund from the Internal Revenue Service this year, 36% intend to use the money to settle debt, and 30% plan to use it to make up missed payments.

42% of respondents, or less than half, intend to save at least some of their return.

“Inflation has slowed, but higher prices continue to impact consumers’ financial wellness,” stated Kate Long, an Assurance IQ consumer financial wellness advocate.

Notably, the poll revealed that 29% of consumers, including almost half (48%) of Gen Z, are thinking about using their tax refunds to pay for insurance as rates continue to rise.

“Lower income households who live paycheck to paycheck have been hit hard by inflation,” Long said. “An influx of cash, such as a tax refund, can be a lifeline that helps them catch up on outstanding debt or cover critical expenses, like insurance.”

According to the survey, over 23% of consumers who anticipate a refund intend to spend their tax refund on “fun,” while 19% intend to invest and 3% aim to contribute. Roughly 12% are not sure how they will use it.