Survey: Consumers Use Tax Refunds to Pay Down Debt
June 13, 2014
Americans were budget and money conscious with their tax returns this year, according to a survey by American Consumer Credit Counseling. Sixty-nine percent of American consumers used their tax refund to pay down debt and get ahead on monthly expenses such as rent, utilities and car payments, while only 16 percent splurged and bought themselves something, according to the survey.
“It’s encouraging that so many consumers are making smart decisions with their money by opting to pay down credit cards and catch up on bills rather than dig themselves deeper into debt,” ACCC President and CEO Steven Trumble said.
Of the 179 consumers surveyed, 11 percent reported owing more taxes after filing and 14 percent did not receive a refund. Of those respondents who owed the government money, the majority, 19 percent, owed between $100 and $499.
When asked if they would rather pay more toward taxes in order to receive a larger refund or keep more of their paycheck and receive a smaller refund, 45 percent of respondents preferred the latter, according to the survey. Nearly half, 45 percent of those aged 18 to 34 would rather fork over more of their paycheck in order to see a larger refund.