Washington, DC (PRWEB) March 05, 2013
Millions of Americans celebrate receiving an income tax refund each year. Many of these same people live each month under the burden of financial hardship, struggling to make ends meet, often falling behind on living expenses and debt obligations.
The February poll hosted on the National Foundation for Credit Counseling (NFCC) website revealed that a significant majority of respondents, 58 percent, intentionally plan to always receive an income tax refund, unnecessarily allowing Uncle Sam the use of their hard-earned money, only to have it returned to them without benefit of interest.
Not only is the American taxpayer self-inflicting financial pain, they are doing so with intentionality, said Gail Cunningham, spokesperson for the NFCC. It boils down to a simple choice of determining if its more important to have extra money in their pocket each month or once per year.
The average income tax refund in recent years has been in the $ 3,000 range, or approximately $ 250 per month. For many people, that amount can mean the difference between financial solvency and financial distress, yet they continue to have too much money deducted from their paycheck month after month. Further, although well-meaning, many who receive the refund dont spend it wisely, and even for those who do, once the money is gone, the cycle of struggling to responsibly pay monthly bills begins all over again.
Many consumers argue in favor of an income tax refund saying that it is a forced savings. That is correct, but there is a better way to save. The NFCC advises consumers to implement the following three-step program when they receive this years refund: