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Loan Money To The US Government…WITH NO INTEREST!

As a regular practice, I see a client's tax return and review its preparation and basic entries. While I'm not a CPA, as part of my Certified Financial Planner™ training, I attended a full tax section, so I am trained in taxes although I wouldn't think of doing my own taxes. More often than not, I find that the client received a tax return- and feels good about it. When pressed why, I'm mostly told they feel good about getting back a lump sum of money that can be used for vacation, a luxury purchase, or other expenditure that would not ordinarily be in the budget. Sounds good, but the questions is..." why would you give the government money all year for them to give back to you, when they don't pay you interest?"

I've been perplexed by this philosophy my entire professional life. While I understand the basic premise, I can't agree with the outcome, which is the title of this article. If you would like to have a lump sum available to you some time in the future, welcome to financial planning- creating and executing a plan for your finances to grow your net worth. The government enjoys the use of literally billions of dollars annually from people who pay too much weekly from their paychecks, and then give it back to you after January 1st with no interest. If you are in this category, I suggest you talk with your tax accountant to adjust your withholding each week to adjust for the amount you receive back in your tax refund. If you want to save up for something, save up for it! Put away a little each week- even a savings account will pay you SOMETHING! In addition, it will be available to you mid-year if you have to get your hands on some cash. So, do us all a favor...don't give the government money to hold for you, have use of it all year, and not pay you interest. I'm all for being patriotic, but business is business!

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