More Americans this year are expected to put their tax returns in the bank. According to the National Retail Federation (NRF)’s Tax Returns Survey conducted by Prosper Insights & Analytics, 46% of those expecting a refund this year will put their money into savings, up from 44% last year and the highest percent in the survey’s history.
Two-thirds (66.6%) of those surveyed are expecting a refund this year. As for other ways consumers will use their refunds, 37.7% will pay down debt, and one-quarter (25.3%) will use it toward everyday expenses. One-in-10 (10.7%) will treat themselves and invest in a major purchase, and 12.8% will spend their refunds on a vacation.
Young adults between 18 and 24 are most likely to save their tax returns, with nearly six-in-10 (57.7%) planning to contribute to their savings accounts, higher than any other age group. They are also the most likely to use their refunds for everyday expenses (34%) and to purchase a big-ticket item such as a new television or piece of furniture (18.3%). Three-in-10 (30.2%) will use their checks to pay down debt, second to last behind those 65 and older (27%).
“Financial security is top-of-mind for all Americans, and refunds can play a huge role in helping achieve that,” said NRF president and CEO Matthew Shay. “Whether consumers use a refund to pay down debt, bulk up their savings, or buy that big-ticket item they’ve been saving for, a check from Uncle Sam, large or small, goes a long way these days.”