Originally Posted by 15fan
Instead, look at this as free money. It's money you haven't had. Set up an IRA or something. We've got some astute financial planning type folks around here. If you or your family don't know anyone who can give you good advice, I'm sure we can get some of the experts on here to weigh in. This is a great way to start learning about the importance of saving, investing, etc. The earlier you start, the better off you'll be in the long run.
Agree and dissagree.
Agree 1000000% about setting up a savings plan now and getting into the habbit of saving when young. Even small amounts of money now will grow into something big over time. Plus once you get in the routine of saving you can increase the amount, and move into better investment vechiles as you make more income.
Plan on a monthly amount you can afford and then put it into savings as if you are paying a bill right at the begining of the month. Just using "whatever is left over at the end of the month" will greatly reduce what ends up in savings. We put a specific amount in savings every month, and then also put whatevers left over (if anything) at the end of the month. Start with a regular savings account for now, and then look into other investment options down the road.
Dissagree 100000% about viewing a tax return as "free money". It's not free money, it's YOUR money, that the governement has kept for up to a year and returned to you with ZERO interest. It's the furthest thing from free. Horrable, horrable savings plan to have as much taxes as possible withheld every month so you get a big return. I'm not making any commentary on paying taxes, just saying that trying to plan on a big return is a flat out dumb way to save money.
I understand what you mean about how the orginal poster should view this particular tax return as "found money" and using it to jump-start a savings account, but it's a big mistake to view tax return as a gift from uncle sam. If anything, they are returning stolen property.