Ways to Get a Tax Refund

I just saw a commercial from H&R Block about the option of having our tax refund put onto a debit card (actually, they started offering it as an option last year). I’m totally against this because I don’t think it is the best idea to have someone else hold my refund. If anything, I want my refund as quickly as possible so I can put it into my savings and investments. With that said, here are some alternatives for your tax refund.

Getting a Check
This is the oldest way to get a refund. Even though checks are used less and less, some of us still opt for this option. In general, we want to avoid this because it takes an additional 3 weeks for IRS to mail our checks to us, not to mention that the check might be lost through the mail. However, those that enjoy the thrill of getting a big check might consider this.

Direct Deposit Into Your Bank Accounts
This option has been available for at least a couple of years now. With an established banking infrastructure in place in the United States, the IRS can transfer money directly into our bank accounts. This is great because we can get our refunds in 6 weeks (3 weeks if we e-file). Actually, I always get them sooner than 3 years in previous years since I file early.

Direct Deposit Into Multiple Accounts
A new option this year is to split our refund into multiple accounts. That means we can allocate the refund into several different accounts. An example would be to use the refund to pay off the credit card bill by putting a portion into our checking account and then another portion into our saving account.

Direct Deposit Into Our Retirement Accounts
Notice all the options are direct deposit? That’s because it is the recommended way! Another benefit of using direct deposit is that we can deposit it directly into our retirement accounts. That way, we can save that money without giving ourselves the chance to spend it. This year, I plan to put all of my refund into my Roth IRA for 2008.

Whichever way we choose to receive our refund is up to us, but these choices will have a long lasting impact on our finances. If we choose to save every refund check, it will go a long way into helping us build wealth. Contrary, if we choose to get a check and then spend it all, we will probably regret it when we are old.

Tagged as: Tax

Promote or Save This Article

If you like this article, please consider bookmarking or helping us promote it!

Print Post | Email Post | Del.icio.us | Stumble it! | Reddit |

Related Posts

• What do you spend your tax refund on?
• Budget Travel
• Value Added Tax Refund (VAT) for Vacation Shopping
• Your 2007 Tax Refunds
• Paying for Turbo Tax Returns is Better Than Filing for Free?

Subscribe! (and Get a Mini-Course with Free Registration)

Follow me on twitter! In addition, subscribe to my RSS feed or take advantage of the newsletter to have content delivered to you. For starters, a 7-part mini course to help you spend less and be happy will be delivered to you when you subscribe!

(Don't worry about spam, because we hate it as much as you do!)