‘Tis the Season of Tax Refunds

Tax return check Think all the big shopping holidays have passed? Think again. While most Americans wouldn’t consider the process of preparing a tax return a festive event, the resulting refunds that millions will receive are likely to boost their spirits … and their spending power.

Tax refunds typically amount to more than a little spare change. Last year, the average refund was more than $3,000.  Not everyone is going to go out and splurge: Unlike the holiday season, tax season is commonly associated with more prudent spending on things like bills and needed home repairs. But even financial advisors tell consumers that it is wise to use at least some of this “found money” on something they need and/or something they want.

Needs

That means it’s a good time to showcase some big-ticket items like major home appliances especially the new energy-efficient models that might pay off on next year’s return; and on technology items such as computers, tablets, printers and scanners, and even hard drives.

Wants

Keep in mind that even prudent consumers are likely to put at least part of their refunds into this category. The trick is to think about the things that aren’t so easily wrapped and left under a tree.  Vacations are one of the most popular uses of tax refunds and with those big-ticket purchases come many smaller ticket purchases associated with planning a trip, from swimwear, to cameras, luggage and comfortable shoes.

In Betweens

There are also many purchases don’t fit exclusively into either of the above categories. Consumers put off buying all kinds of things they genuinely need: a good winter coat, a sectional couch, a new duvet cover, or even a good rug. Receiving an extra check in late winter can make it the perfect time for one of these quasi-practical purchases.

Still wondering how consumers spend their tax refunds? Here’s a tip: Think about some of the things on your own list of wants and needs that weren’t gifted over the holidays. Focus in on one of these categories, or remind your visitors of all the things they really need. Or want.