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Old 01-29-2013, 03:03 AM   #76
angwill
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Originally Posted by marius97 View Post
I am an accounting student (adult). Between my wife's good job, deductions for three kids and my school expenses, we always get a really BIG refund. I know that is not advisable because it is giving the government an interest free loan. Every class I take always has at some point a lecture about the evils of big refunds. I just sit there and nod my head in agreement as I think about my vacation being paid for out of our refund. I'm not disciplined enough to save out of each check if we adjusted things to get a smaller/no refund. Even if I was, invariably some of that money would disappear into general household needs. That disappearing money would negate any interest I could have earned by sticking the saved money into something that would earn a small interest rate. I am so ashamed of my big refund but I don't care anymore once we see the Welcome to Florida sign.
Don't feel bad we pay taxes at the end of the year and save the percentage in a savings from every paycheck through out the year. I think we earned $14 in interest last year on the tax savings account. The government isn't getting that much in interest from you. lol

You do however have the option of having a certain amount automatically deposited into savings every time you get paid too though.
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Old 02-08-2013, 11:29 PM   #77
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We also do it this way and prefer to get back a big refund vs. having a little more on each paycheck. We've paid off bills, paid for vacations, bought<used> vehicles (managed to have no vehicle payments for last 8 years!!), and bought used RVs at tax time. It's kept our debt lowered and allowed us to have alot of fun without putting us in a bind financially. Getting a few dollars more each check would just get shuffled into everyday life and we'd never be able to pay cash for vehicles that way.......so, if I have to loan it out for free for a year in order to do that, then so be it
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Old 02-09-2013, 11:30 AM   #78
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I teach Business Math and Accounting at a local community college. When we get to the section on Income Tax withholding, I mention the "interest free loan" idea and how from a purely mathematical prospective you would be better off breaking even or even owing a little bit. But I also mention that from a practical perspective, letting the government save the money for you is better than not saving the money at all.

Me personally, I save a little bit on my own as well as shoot for a moderate size refund of $500 to $1,500. Frequently my income is right on the border for the Saver Credit so I need to wait to make my IRA contribution until I file my taxes to see if it's better to do the traditional or Roth IRA. Frequently, the years I get a big refund it's because I need to make a big IRA contribution into the proper type of IRA.
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Old 02-09-2013, 12:56 PM   #79
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Originally Posted by marius97 View Post
we always get a really BIG refund. I know that is not advisable because it is giving the government an interest free loan. I am so ashamed of my big refund but I don't care anymore once we see the Welcome to Florida sign.
So, I guess you are not one of those people who are opposed to "BIG GOVERNMENT" since you trust the government to manage your money more than you trust yourself.
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Old 02-09-2013, 01:57 PM   #80
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Quote:
Originally Posted by marius97 View Post
I am an accounting student (adult). Between my wife's good job, deductions for three kids and my school expenses, we always get a really BIG refund. I know that is not advisable because it is giving the government an interest free loan. Every class I take always has at some point a lecture about the evils of big refunds. I just sit there and nod my head in agreement as I think about my vacation being paid for out of our refund. I'm not disciplined enough to save out of each check if we adjusted things to get a smaller/no refund. Even if I was, invariably some of that money would disappear into general household needs. That disappearing money would negate any interest I could have earned by sticking the saved money into something that would earn a small interest rate. I am so ashamed of my big refund but I don't care anymore once we see the Welcome to Florida sign.
Hey you gotta do it the way you gotta do it. It doesn't really matter if someone else doesn't do it that way or says not to because it's not good. The measly interest is not a big loss anyway. This is coming from someone who owes this year.
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Old 02-09-2013, 02:05 PM   #81
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We did this too for years. And I agree that it was at least a way to have a trip fund I could not rob. However - one year I dropped the refund into our regular savings account and by the time the trip came $1000 had disappeared.

THEN as the kids have grown up that refund has dropped. It was tied to having 4 kids. I just hope to get a little back this year to help out. I figure after next year we will not get anything unless I have them withhold more.
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Old 02-09-2013, 03:07 PM   #82
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Originally Posted by Mom24Princesses
We did this too for years. And I agree that it was at least a way to have a trip fund I could not rob. However - one year I dropped the refund into our regular savings account and by the time the trip came $1000 had disappeared.

THEN as the kids have grown up that refund has dropped. It was tied to having 4 kids. I just hope to get a little back this year to help out. I figure after next year we will not get anything unless I have them withhold more.
We have no kids, use turbo tax and ALWAYS get something back, some years it has been as little as $200 from the Federal and $200 from the state.

The past few years it has been more since DW is now a full time student in a 4 year degree program. But that won't last much longer.
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Old 02-09-2013, 10:56 PM   #83
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Quote:
Originally Posted by marius97 View Post
I am an accounting student (adult). Between my wife's good job, deductions for three kids and my school expenses, we always get a really BIG refund. I know that is not advisable because it is giving the government an interest free loan. Every class I take always has at some point a lecture about the evils of big refunds. I just sit there and nod my head in agreement as I think about my vacation being paid for out of our refund. I'm not disciplined enough to save out of each check if we adjusted things to get a smaller/no refund. Even if I was, invariably some of that money would disappear into general household needs. That disappearing money would negate any interest I could have earned by sticking the saved money into something that would earn a small interest rate. I am so ashamed of my big refund but I don't care anymore once we see the Welcome to Florida sign.
I don't blame ya for being proud of your big refund. :P

I personally, would rather get a refund (no matter how large or small) than have to pay MORE come tax time. Sure, the ultimate goal (or so I hear) is to try and break even (get back very little or pay very little) but in this day and age (and economy) it can be tough.
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