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Here’s how Americans plan to spend their tax refunds

U.S. taxpayers who are expecting a refund in 2024 say they’re already thinking about what to do with the money. The majority say there is nothing left in their savings after the distribution.

Typically, most taxpayers can expect a refund from Uncle Sam, and the amount can be large for many families. Almost three-quarters of filers received a tax refund in 2023, with the average payment equaling about $3,176.

Almost three-quarters of U.S. taxpayers can expect to receive a tax refund this year. (license/image)

According to a recent survey published by Assurance IQ, 72% of consumers expect to receive a refund from the Internal Revenue Service this year, and more than a third of them, 36%, plan to use that money to pay down debt. We found that 30% plan to use it. It’s to get your monthly bill back.

Less than half, 42%, plan to put at least some of their refund money toward savings.

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“While inflation has slowed, high prices continue to impact consumers’ financial health,” said Kate Long, consumer financial wellness advocate at Assurance IQ.

Internal Revenue Service (IRS) building

Internal Revenue Service building in Washington DC (Stephanie Reynolds/AFP via Getty Images/Getty Images)

Notably, the survey found that as insurance premiums continue to rise, 29% of consumers would consider using their tax refund to pay for insurance, including nearly half of Gen Z (48%). %) was found to be included.

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“Low-income families who live paycheck to paycheck are being hit hard by inflation,” Long said. “An influx of cash, such as a tax refund, can be a lifeline to help you recoup unpaid debts or cover important expenses like insurance.”

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According to the survey, about 23% of consumers expecting a tax refund plan to use it for something “fun,” while 19% plan to invest it and 3% plan to donate it. Approximately 12% are undecided about how they will use their money.

FOX Business’ Megan Henney contributed to this report.

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