For many, tax season this year is like Christmas in the spring. The IRS expects more than 70% of taxpayers to get some sort of refund this year.
Last year, 111 million refunds were issued, with an average repayment of $2,860. And, according to Bankrate.com, millennials make up the highest percentage of those getting cash back at 66%, slightly behind Generation X at 49%. While baby boomers and the Silent Generation will have a 34% and 26% chance respectively of ever seeing some of their cash again.
And how do they plan to spend it?
“Loans, school loans. We’re kind of [growing up, we are] in our 20s, so now we have responsibilities that we didn’t have before, so our money isn’t ours anymore,” a millennial from New York told FOX Business, speaking for her friend as well.
While Adrienne, a Generation Xer from Los Angeles, says he’s using his tax refund to move his family from the West Coast to East Coast in the near future.
Sarah Berger, a money expert and “The Cashlorette” at Bankrate.com tells FOX Business that more people are using their tax refund for practical things this year, as opposed to years past.
“The percentage of people saving and investing their refund this year is the highest it has been among the four [Bankrate.com] surveys we’ve conducted in the past. Millennials in particular are the age group most likely to save or invest their refund this year. They lived through the financial crisis. They likely saw how detrimental it can be to your finances if you don’t have an emergency fund to fall back on when the unexpected occurs,” Berger says.
According to the survey, which was released in March, 34% of Americans plan to either save or invest their refund this year, while 29% say they will spend it on necessities like food, keeping the gas or electricity on, and the other 27% want to pay down their debt.
“I’m paying off bills with it, nothing exciting,” Concheda from Philadelphia tells FOX Business.
But she’s not speaking for everyone, as an estimated 6% of Americans plan to spend their tax refund on a vacation or a shopping spree.
“We’re spending our tax refund right now, here in New York City,” Christina Bergner from North Carolina tells FOX Business.