Are you anxiously awaiting your tax refund? Does this refund create visions of a new spring wardrobe, a luxurious vacation or perhaps a room filled with new furniture and accessories?

Yes, by now we all should know that it’s better to keep as much of your money as long as possible and that overpaying and getting a refund isn’t really financially optimal.

But wait! You say saving during the year is impossible and your tax refund is the only sure way to make this happen. May I remind you why you are receiving this refund? Income tax refunds are due to over-payment on your part to the government. This means the government was given an interest-free loan by you, the taxpayer. Are you financially in a position to give an interest-free loan to our government?

Doesn’t it make more sense to keep it, save it and invest it during the year on your own? Having the motivation and determination to save must come from within you. You can do this!
See your future expectations and plan for the security and peace that you desire later in life. This mantra will help you reach your goal of financial freedom in your future.

So this year when you receive your refund , consider investing it especially in a tax-advantaged vehicle that will allow your earnings to grow tax-deferred. Saving might not be as much fun as shopping, but if you add up all of your spent tax returns , just imagine how much money you would have saved and invested by now?

Please see your professional tax advisor regarding your specific situation.

Answers from AZ.