According to Business Insider
, 80 percent of the U.S. population received a tax refund of more than $2,800 in 2017. That’s a nice chunk of change to land in your lap.
But hey, you paid your dues for the previous year, and you deserve a little something in return. With your tax refund now in hand, the world is your oyster, right? OK, maybe not, but the extra cash is nice to have at the ready.
You can now spend that money on whatever you’d like. So, what’s your flavor? Perhaps you’ll be practical with your tax refund and:
- Pay off debt
- Perform home repairs
- Build a college fund
- Start an emergency fund
- Add to your retirement account
However, if you’re like most folks, that extra money is burning a hole in your pocket to do something fun or to treat yourself. So, maybe you’re thinking about:
- Going shopping for some new clothes
- Planning a vacation
- Putting some money into your hobby of choice
- Taking a long overdue trip
- Joining a gym
All these options—and many more—are perfectly acceptable. You have the right to spend your tax refund however you see fit.
For thousands, getting a tax refund means paying for day-to-day responsibilities, such as car insurance. Using your tax refund to pay for car insurance is more common than you might think.
According to Pete Anhalt, SVP Group Executive at Dairyland Auto®, business picks up during tax season.
“We see a substantial increase in business during tax return season,” Anhalt said.
Some drivers buy during this time because they can now afford to pay for a full year and not have to worry about it for another 12 months. Others pay for auto insurance when they can, such as when their paycheck arrives. The tax refund is used like a paycheck, taking care of the regular bills.
Tax season is also a good time to look at possibly getting some extra coverage
if you plan to be behind the wheel more than usual, such as a family road trip. Check with your provider to see what options you might have available.
Tax refunds are great. And while we’d all like to spend that extra cash in a fun manner, the more practical route is what many end up taking.
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