Press
Iowans taking the wise route with their tax refunds
DES MOINES, IA (March 24, 2015) — Iowa consumers anticipate receiving about the same tax refund in 2015 as in 2014 and most plan to put it in savings according to a recent survey by the Iowa Credit Union League (ICUL).
The statewide survey of more than 1,100 Iowa credit union members and consumers showed that 40 percent of Iowans surveyed are expecting a tax refund about the same as last year’s, while 28 percent are expecting a smaller refund. Twenty-one percent are not expecting a refund whatsoever.
Well over 50 percent of those Iowans expecting some type of refund, including the nine percent anticipating a larger refund this year, are planning to put it into savings. This continues last year’s trend according to the National Retail Federation’s 2014 annual survey, which found that 46 percent of American consumers expecting a refund last year saved it as opposed to making a large purchase or paying down debt. It was the highest level of anticipated saving in the survey’s eight-year history.
Jim Niederhauser, VP, Member Services at ICUL, and former CEO of an Iowa credit union, said credit unions will see a boost in deposits this time of year but those deposits don’t always stay put.
“It is not uncommon to see a significant spike in member deposits beginning in late January and extending into March,” Niederhauser said. “Once the weather warms, credit union members tend to allocate their deposits towards consumption. But it is interesting and encouraging to see a trend where the deposits remain in their accounts with the credit union for a longer period of time.”
In Iowa, 45 percent of respondents plan to use their refunds to pay off debt and only four percent plan to splurge on a large purchase. Niederhauser said consumers are prudent to use their refunds to lessen their debt, spend wisely on needed expenditures or as a savings cushion for financial emergencies.
“If you’re unsure how to best use your tax refund or would like to make a plan for it, you can reach out to your credit union,” Niederhauser said. “We want Iowa consumers to know they can turn to their local financial cooperatives for unbiased, trustworthy advice.”
Ideas for spending tax refund money wisely:
- Save it. Rather than spending tax refund money right away, put the money into a savings account and build on it each month.
- Invest it. Use tax refund money as a down payment on a reliable vehicle. The larger the down payment, the less your monthly payments will set you back.
- Make a cushion. Keep tax refund money in your checking account as a cushion for when finances get tight.
- Pay down debt. Spend the money to pay down debt and get your credit in good standing.
- To learn more about credit unions or to find a credit union to join, visit: www.IowaCreditUnions.com
About the Iowa Credit Union League
The Iowa Credit Union League is the trade association that represents the interests of Iowa credit unions and their more than one million members. Credit unions are not-for-profit, financial cooperatives owned and operated by their members. Iowans use their credit union membership to receive higher interest rates on savings and lower interest rates on loans. For more information on ICUL and Iowa credit unions, visit www.IowaCreditUnions.com. Follow ICUL on Twitter at www.twitter.com/icul or on Facebook at www.facebook.com/iowacreditunions.To learn more about credit unions, visit www.ASmarterChoice.org.