Big tax refund!
- Thread starter vraiblonde
- Start date
Baja28
Obama destroyed America
I looked at the last few years returns and adjusted my with-holding trying to get neutral. Of course the communist state of MD just taxes & taxes us to death.
bcp
In My Opinion
I am pretty close to even on tax, my returns are always in the hundreds, but, what I get back from federal has been used to pay what I owed in state for the last few years.
I do save each month, and was actually doing pretty good on the retirement savings, (not to confused with the 401) until some unexpected checks were sent out.
well that and when I shut my business down I did not do it properly and the state and fed thought I was still running and wanted tax for the periods that I didnt file after not shutting it down properly. I did have to pay a few thousand to clear that mess up.
State is finally done, still fighting with the IRS on what they think they should get.
I do save each month, and was actually doing pretty good on the retirement savings, (not to confused with the 401) until some unexpected checks were sent out.
well that and when I shut my business down I did not do it properly and the state and fed thought I was still running and wanted tax for the periods that I didnt file after not shutting it down properly. I did have to pay a few thousand to clear that mess up.
State is finally done, still fighting with the IRS on what they think they should get.
ProfMoneyWise
Member
Discipline is the key. With discipline you can be your own forced savings account.
Budgeting to zero and giving every dollar a name puts accountability on ourselves and maximizes our most powerful financial resource. Our incomes.
Budgeting to zero and giving every dollar a name puts accountability on ourselves and maximizes our most powerful financial resource. Our incomes.
kwillia
n/a
And then you die.
There's that, too - interest earned, which is.
That right there - the big yawn. I once held a dim view of anyone that used Uncle Sugar as their 'savings account', considering it to be poor financial management, but I really don't any more. Last I looked, my money market savings account was paying about a half a percent in annual interest rate.
I know, but people don't do that. I am very fiscally responsible and *I* don't do that. If there's an extra $500 or $1000, sure - in the savings it goes. But $50 or $100 is a small enough sum that I don't think twice about frittering it away on something I don't really need.
kwillia
n/a
And the banks are not paying any kind of noticable interest on savings accounts.
aps45819
24/7 Single Dad
You actually loaned the government $10,000 and recieved no interest on the loan?
Ever hear of an allotment? Part of you pay goes directly to a bank account.
Yep!
aps45819
24/7 Single Dad
if you're getting $10K back you have an extra $800 every month you could be putting in savings, playing the stock market or an IRA
My IRA max allowed already gets taken out of my paycheck; I have no intention of ever putting one single dollar into the stock market again; and my savings account doesn't yield enough interest for it to matter.
Next?
Toxick
Splat
Now, here's the thing:
My first FIL used to get all kinds of bent about tax refunds. His take was that you're lending the government money interest-free. MY take is that those few hundred buck a month would get pissed away frivolously and not saved. But when you get a check for $10,000, THAT is real money and you'll put it in savings or make a major purchase with it (mine will go into savings).
Even if your refund is only a thousand or two, it's still a big fat check vs. the hundred or two you'd have kept each month and frittered away. Currently anyone could shave at least $50 off their monthly expenditures, and stick it in savings. But nobody does that - we spend what we make.
So why does it make any sense at all to get right on the dollar with your taxes and not overpay? Sort of like an enforced savings account.
Well, you also said [-4, ∞] and [-4, ∞) are the same thing, so....
Bazinga!
kwillia
n/a
ProfMoneyWise
Member
Yes Vrai, people actually do this.
ProfMoneyWise
Member
Agree. The banks are not paying it because the banks are not receiving it given the historically low rates.
The only money I put in a bank type savings vehicle is money needed in 5 years or less. That money is locked up tight with no concerns about the rate of return.
ProfMoneyWise
Member
Eliminate all debt and pile up cash.
I just do not let the State or Federal Government hold onto it for me. I've seen how they manage money and I'm not a fan.
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I have no debt except for my mortgage. And this is my way of piling up cash. Seriously, I know myself. An extra $500 or $1000 in my pocket will get spent. A check for $10,000 will be saved.
It's a psychological thing. When I was living dirt poor and trying to raise children paycheck to paycheck, any small surprise money that came my way - work bonus, birthday cash, whatever - got spent as a treat. We'd go to dinner, or get some new clothes, or shoes, something fun. But when I got my $2000 tax return back, it was put into savings and it didn't occur to me to just spend it. It was earmarked for emergencies.
And really, big bank balances and cash under the mattress are fun to look at, but they have no practical use. Money has no value except for what it buys you.
ProfMoneyWise
Member
Pay off that mortgage Vrai. It feels good to own where you sleep and if you pay it off and don't like it you can always go get a HELOC if owing on it makes you feel better.