More Americans Will Save their Tax Refunds

“A lot of money goes to money-heaven,” explained  Björgólfur Thor Björgólfsson of Iceland.  Where does money in the U.S. go?  Where do people want to put their money?  Where do they feel they must put it to use?  One indication of the U.S. economy is what people do with their tax refunds.  Some years the money seems to evaporate into an amorphous heaven.  Other years, people are able to put it toward something more tangible.

Harris Interactive© on behalf of CareerBuilder conducted a survey to determine the uses of tax refunds for this year.   They surveyed 3,910 U.S. workers (employed full-time; not self-employed; non government) to determine people’s tentative plans for spending their refund checks.

Forty-six percent planned to pay off bills, down from 56 percent last year.  This indicates that there is a little less urgency for immediate cash, that more people are regularly capable of paying off their debts.

Thirty-six percent workers will use their tax refund to augment their savings accounts, up from 34 percent who said the same last year.  Although this may not be a huge change, it does indicate a shift in people’s economic stability.

Sixty-one percent identified themselves as living “paycheck to paycheck.”  This grim reality points to the number of people for whom a savings account is scarcely a reality.  That said, this number of people struggling to make ends meet is down from seventy-seven percent from earlier in 2010.

“Even though fewer workers are living paycheck to paycheck and are saving more, workers’ wallets are still feeling the strain of the past few years,” said Rosemary Haefner, vice president of human resources for CareerBuilder. “As the economy gradually rebounds and strengthens, workers are gaining confidence. We’re seeing this already as more are investing in their futures and preparing for challenges down the road.”