I’ve talked a lot about taxes over the last two days.  Now it’s time to discuss tax refunds.  Yes, April 15th, 2026 will be here before you know it and it will be tax time.

For some of you, you’ll end up paying.  If that happens, you can always adjust your W-4 with your employer and take less deductions.  For example, you have a family of four and you have listed four deductions on your W-4.  What is a W-4?  It’s a form provided by the IRS to your employer.  The form basically tells your employer how much federal income tax that you have opted to have had withheld.  Your number of deductions is based on the number you choose when completing the form..  In this example, let’s assume you originally chose 4 deductions.  You can change that to between 0 and 3 deductions.  The result will be that your employer will take out more in taxes and your paycheck will be smaller.  How much smaller?  Discuss that with your payroll department.  They can probably give you a reasonable estimate.

Now what if you’re lucky enough to get a refund?  Many consider that a bad thing because you’re loaning the government your money for the year.  You do get it back the following year, but it hasn’t been in your possession.  For some of you, that’s probably a good thing because all you’d do is spend it.  For others, you lose a little bit of interest because it wasn’t sitting in your savings account.  For me personally, I opt to get that windfall refund each year.  I then put it in my high interest savings account and let it accrue year after year.  If I need to add it to my emergency fund, then that’s where it goes.  But, the bottom line is that I don’t run out and spend it.  I save it, always.  

Moral of the story:

If you are one of the millions of people that gets a tax refund, save it!  Don’t spend it!  That was a lesson that hubby had to learn.  He got the windfall and always went out an blew it.  That was until he met me and asked me to manage his money.  That practice went the way of the dodo bird.  He didn’t like it at first but now that he has seen his money accruing, he likes it just fine.  LOL