Getting a BIG check from the IRS this year?
Next year you may want to rethink things.
Bankrate.com says you probably should get a small refund if any.
Why?
When you get a big refund, it’s usually because you had too much money withheld from your paychecks.
Many of us use it to pay down credit card debt, which racks up interest all year…and if you had a little more money in your pocket, maybe you wouldn’t have NEEDED to use your credit card in the first place.
Better yet, the extra cash could have automatically been deposited into a retirement account for a REALLY big payoff down the road.
For example, let’s say you get paid twice a month, and got a really nice refund this year of $1,200 or overpaying by about $50 per paycheck.
If you invested all that money and kept doing it for 30 years, you’d put away $36,000…but if your 401K or IRA made 6% a year, you’d end up with close to $100,00!
Food for thought for next year’s W2!
