What will you do with your refund?

Many people think tax preparers are boring accountants, mired in numbers from dawn 'til dusk.  While that may be true for some, I think there is a large human component as well.  We meet so many people, from all walks of life, with all sorts of occupations and family situations, that you never know who you'll meet next.

One of my favorite things during tax season is asking what someone will do with their refund. Whether it's their usual refund amount, or an unexpected windfall, most people have a plan for at least part of it.

Many people use their refund for a home improvement. Some have the philosophy is that since the refund is largely due to the house and related deductions, the refund goes back into the house. Either a necessary repair or some type of improvement, they now have a chunk of funding for their project. I've heard about a lot of plans and they run the gamut from building a dream man cave to just keeping the water out. The least exciting repair has to be the new garage door, followed closely by a new roof. The most fun are the plans for a kitchen or bathroom remodel. Even new appliances are fun to think about.

Some people will use their refunds for vacation. I love to hear about travel plans.  One client had been going through some really tough times, raising three children on her own. An unexpected refund of several thousand dollars practically brought her to tears.  She had always wanted to take her kids to Disney World. But things were very uncertain and she didn't know what would happen from one day to the next. She decided to hold off, and if she still had the money at Christmas, she would surprise her kids with the trip then. And she did it. She told me about it the next tax season. What an inspiration. She held on to the refund for almost a whole year and made a wonderful family memory.

There are always a some folks who will wisely save their refund, either in an IRA or for emergencies.  Many people will pay off bills, pay down credit cards or a car loan, or even just make rent for that month. More and more folks mention some type of gambling adventure as part of their plans.

The worst refund story (and you know who you are) has to be a young lady working her way through college.  She got an unexpected refund of over $1000.  When I asked her plans for it, she said she could now afford to get her wisdom teeth removed.  Her insurance didn't cover it, but she need to get it done. Yikes! While any refund is a good refund, wisdom tooth removal has to be about the worst thing I could think of to do with my refund.

What will you do with yours?