When it comes to tax advice, personal finance expert Suze Orman had quite an interesting spin on tax refunds to share with us.
“Here's the bottom line,” said Suze. “If you owe taxes, pay them! Don't get tricky and come up with reasons to not pay them or do write-offs. You should be saving for taxes,” she cautions.
As for her take on tax refunds, Suze believes that if you are getting a tax refund this year, you are making a mistake. “Did the IRS pay you interest on the money you got back?” Suze asked. “You are basically giving Uncle Sam an interest-free loan!”
Suze recommends trying to decrease your tax returns and increase your exemptions each month so that you get more money each month rather than in one lump sun. “The average tax refund is $3K,” she told us, “but if you could increase the exemptions, you could be taking $250 per month and funding an IRA with that.”
Suze believes you’re better off getting money up front each month, investing it and using it to pay off any credit card debt or loans instead of “giving it to Uncle Sam interest-free” through write-offs.
Get one on one financial advice from Suze here.
For more advice on managing your money, see Suze's personal finance tips:
Add Marlo On Facebook:
Follow Marlo on Twitter:
Sign up to receive my email newsletter each week - It will keep you up-to-date on upcoming articles, Mondays with Marlo guests, videos, and more!