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Each year, millions of Americans look forward to a Spring
windfall. The government kindly sends them hundreds or
even thousands of dollars, which they will wisely invest
or use to fulfill lifelong dreams. But there’s
another way to look at this rosy scenario.
Each year, millions of Americans let Uncle Sam take
and hold on to hundreds or thousands of their hard-earned
dollars each pay, interest-free. After letting the government
keep and reap the rewards of their cash, they fritter
away their refunds on vacation or furniture or –
even worse – take out loans to tide them over
until their refunds arrive!
As much as we all love to get a hefty check in the
mail, let’s face the facts. A tax refund simply
means you’ve been paying more than you need to
all year long. So why let Uncle Sam use your money,
when you could be using it yourself?
If you are expecting a large refund for last year’s
taxes, ask your tax advisor if you should adjust your
withholding rate this year. Set aside the extra income
in a separate account, and next year at this time you’ll
have a windfall of your own – with interest!
Check out the IRS website and tinker with the withholding calculator (click on the More Online Tools link on the homepage) so you can adjust your W-4 and get more money in your paycheck! |
