Getting your tax refund can feel like free money. Sure, we know it isn’t, but at the end of the day we still walk away with extra cash in our pockets.
We all have different plans for that money, though.
Financial services company Santander surveyed 2,211 American “middle-income” adults — those with a household income between $50,000 and $148,000. With those answers, the group identified how middle-class adults plan on spending their tax refunds in 2024.
How do your plans compare? Following are the top plans these folks have for their refunds.
1. Pay debts
Survey respondents who said they plan to do this with their tax refund: 42%
Paying down debt is important for financial health. There are many surefire ways to make that happen, and using your tax refund can certainly help you get ahead.
2. Save it
Survey respondents who said they plan to do this with their tax refund: 42%
With two-thirds of middle-income Americans cutting their budgets, people have been financially strained. It’s great that those who find themselves with extra cash are putting it towards their savings when they may not usually have much to spare.
3. Invest it
Survey respondents who said they plan to do this with their tax refund: 16%
Inflation is hurting America’s wallets. Finding ways to invest money so it grows alongside the economy can help stretch your dollars out in the future. Not sure where to start? Check out “How to Start Investing — No Matter How Much Money You Have.”
4. Make a large purchase
Survey respondents who said they plan to do this with their tax refund: 14%
Having extra money makes tackling a big-ticket item more manageable. Santander’s study respondents indicated that these large purchases primarily include vehicles, home improvement or a home.
5. Spend it on something else
Survey respondents who said they plan to do this with their tax refund: 11%
We all have things in life we want but keep putting off — maybe that’s a new couch, a TV or perhaps more modestly, a big grocery store haul. Middle-income adults have plenty of things on their minds when deciding where to put their refund money.
6. Spent it before it arrived
Survey respondents who said they plan to do this with their tax refund: 6%
Waiting is hard, and these study respondents sure know that. Hopefully, they knew just how much money they’d be getting back before making a purchase they couldn’t otherwise afford. And hopefully they didn’t use a costly tax refund advance loan.
