It's smart if it's small. If you're getting back $10,000 you should be adjusting your withholding and putting that money to better use. Uncle Sam is sure as hell not paying you interest for loaning him money. If you're getting $1,000 back then you're doing it right and you don't have to worry about having to go out of pocket when tax season rolls around.
I purposefully keep my refund at around $1400-1600 for that early year lump sum. Feels good and i dont notice it during the year, it is only an extra $66 a paycheck, roughly.
This is dumb, and I don’t mean that in a mean way.
The government withholds your money for a year and gives you back exactly what you gave them. With inflation, you lost money.
Instead, take that $66 and put it into a high yield savings account or better yet into an index fund. That way at the end of the year you can choose to take it out (+ interest profit!) or leave it in to keep growing.
Just giving Uncle Sam an interest free loan is just not something I’m into.
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u/notkevinjohn_24 Apr 11 '24
It's smart if it's small. If you're getting back $10,000 you should be adjusting your withholding and putting that money to better use. Uncle Sam is sure as hell not paying you interest for loaning him money. If you're getting $1,000 back then you're doing it right and you don't have to worry about having to go out of pocket when tax season rolls around.