One Step This Month: Reflect on Your Refund

So far this year, the average American’s federal tax refund is about 11% lower than last year, according to the Internal Revenue Service. Are you planning to use some of your refund for paying off bills or debt, or for something fun, such as a much-needed vacation? What about the rest of your refund? Chances are, it’s a nice chunk of change. So take time to think through where you’ll use it. Here are some ideas that could pay off.

Pad your emergency fund. Unexpected crises at home (like fender benders or broken appliances) can throw your budget into a tailspin. Tucking away a little extra for emergencies keeps your finances on track and can put your mind at ease. Get tailored tips for saving.

Save more for retirement. Take advantage of your benefits! Each dollar you contribute to your 401(k) up to 6% of your eligible pay will be matched with $1.17 by your Heritage employer. This “free money” grows over the course of your career. Catch a helpful webinar to help guide your choices.

Pay down high-interest debt. Credit cards with high interest rates can sap money. Putting your tax refund toward an outstanding balance can save you money over the long term.

Provide for your family’s health. Put more money in your health savings account, which grows tax free. You can use it to pay for lots of health-related expenses, like braces, glasses, prescriptions or surgery. Plus it stays with you even if you decide to change jobs.

Bottom Line: Put some thought into how you’ll use your tax refund this year. You’ll thank yourself later!

Having trouble making ends meet?

The ONE Heritage Fund was created to help employees who are facing financial hardship immediately after a natural disaster or an unforeseen personal hardship. Email questions to

oneheritagefund@emergencyassistancefdn.org or call 855-583-0774.

Double-check your W-4: If you’re struggling during the year and receiving a large tax refund, you may want to adjust your federal income tax withholding on Form W-4 to receive a little more in your take home pay (i.e., fewer dollars withheld for federal taxes). You can also make adjustments to plan for a refund instead of paying during tax time. Contact HR Shared Services or Employee Self Service for help.

Inspired to help others? Consider donating (tax-deductible) to the ONE Heritage Fund to support your fellow employees.

Planning with Your Partner

Financial stress is just one of the factors that can wring the romance out of your relationship with your partner. Making time for the things that really matter — connecting, having fun, playing and resting — can be challenging. April’s Perspectives webinar, “Making Time for Work and Family,” deals with the realities of busy working partners and offers ideas for making the most of the time and energy you share.

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How Americans Plan to Spend Their Tax Returns in 2023

Living within Your (Seasonal) Budget

Budgeting can be challenging, especially not when your income varies with the seasons. However, with a little planning, you can keep your finances on track.

Step 1: Determine your average monthly income. Add up your post-tax income for the past three years. Then divide that sum by 36. The answer will give you a sense of your average income over time.



Step 2: Calculate your average monthly expenses. To determine how much you spend each month, add up your expenses for a year and divide that figure by 12. (If your records go back more than one year, even better! Be sure to factor in emergency, impulse and one-time needs, as well.)

Step 3: Compare. If your average expenses are more than your income, consider cutting back expenses or finding a part-time job during the off-season.

Step 4: Commit to yourself. Hold yourself accountable. Sticking to a budget is hard work. By taking a proactive approach, you can make the most of your earnings. 

Money Management Tips

• Create a budget and stick to it.
• Be a saver. Even small amounts add up over time.
• Plan for the unexpected. Emergencies happen.
• Weigh costs versus benefits. Sometimes a higher quality item lasts longer.
• Talk about money, savings goals and expenses with your partner or roommate.
• Allow yourself a splurge once in a while.

Sources:

• US News and World Report: What to Do With Your Tax Return Money
• Stillman Bank: How To Budget When You Have Seasonal Income
• NBC News.com: What I Learned about Money from Working a Seasonal Job