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How to Spend Your Tax Refund

how to spend your tax refund

Your tax returns were filed a few weeks ago, and now ✨ shazam ✨ refunds from the state and federal governments are in your bank account. Now, what to do with your tax refund?

More than two-thirds of taxpayers are expecting refunds from the 2023 tax year, and many have already received them, noted a recent Bankrate survey.  By mid-February, more than 25.5 million taxpayers filed returns, yielding average refunds of about $1,741, according to the Internal Revenue Service.

For some, tax returns are a chance to splurge, and for others, it’s extra money to save or put toward bills like car payments or student loans. Maybe you do a little bit of both. Here are a few ideas for how to spend your tax refund.

how to spend your tax refund

Trips To Take With Your Tax Refund

About 7% of people getting refunds plan to spend the money on vacations, Bankrate reported.

This is indeed a busy time for AAA Travel, according to Chuck Nardozza, managing director of travel sales. “People tend to book trips very quickly,” he said. “We start to see people going during the first quarter of the year. They are warm weather destinations, winter getaways.”

Top-booked destinations include:

  • Aruba
  • Punta Cana
  • Cancun
  • Jamaica

Also popular are Caribbean cruises, including cruises for families, all-inclusive resorts and theme park destinations like Walt Disney World and Universal Studios.

“A vacation is a popular choice for many who are looking for a way to spend their refund wisely on memorable experiences,” Nardozza added.

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Plan a Day of Fun

If not a full-blown vacation, there are still plenty of fun experiences you can plan with your refund money. Spend a day at an amusement park or water park with the family, go to a concert, see a Broadway show or cheer on your favorite team at a game.

Get discounted tickets on all of the above, and more!

In need of some retail therapy? Check out these 17 Products Our Readers Love. You might find just the thing you’ve been looking for, or something you didn’t even know you needed.

Build Up That Nest Egg

Instead of wondering how to spend your tax refund, you might be thinking about how to save it. The Bankrate survey found that 28% of taxpayers planned to use the money to boost their savings, while 19% planned to pay off debt.

If you are looking to build your savings, AAA has a variety of financial services that can help. In collaboration with Discover, AAA offers certificates of deposit, money market accounts and IRA certificates, all at competitive rates. Open a no-hassle savings account and watch your money grow. Learn more.

How do you get the most from your tax return? Tell us in the comments.

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