This year, as millions of Americans deal with what may be the worst housing crisis since the Great Depression, those traditional tax-check shopping sprees may never come to pass.
Only two percent of Angie’s List www.angieslist.com members plan to splurge with their tax rebates or refunds this year, according to the company’s latest national survey. A third of those polled say they’ll use their tax checks to pay down bills.
“Our members, generally speaking, are careful with their money and like to spend it wisely,” said Angie Hicks, founder of Angie’s List. “But like many Americans, about half of our members see 2008 as year that will be financially difficult so they’re not looking at those tax checks as ‘mad money’ at all this year.”
Angie went to the experts to gather advice for spending tax refunds and rebates, as well as some advice for how to handle your money during the economic downturn.
For those who have a financial cushion, now is the time to consider strategic investments, she said.
“The old adage of ‘buy low and sell high’ is still used because it actually works,” Hicks said. “Be sure you’re buying quality funds and stocks, though, so you get to the 'high' part when the market rebounds.”
Other advice:
For homeowners worried about how to escape foreclosure:
Take the time to assess your situation to determine if you can cut back on unnecessary expenses and then take those steps.
Save your tax refund or rebate as long as possible, or apply it to your mortgage rather than splurging on something that won’t improve your financial situation.
If you know you won’t be able to make the mortgage, call your mortgage holder and ask to speak with a loss mitigation expert. The bank or lender has little interest in acquiring more properties (they generally lose thousands on each foreclosed upon property) and will work with you to craft a way out of your situation.
Even if you have missed payments already, a loss mitigation expert or credit counselor can – and will – help you.
For more advice, go to www.995hope.org <http://www.995hope.org/> – a national, not-for-profit organization that focuses on helping homeowners avoid foreclosure.
For homeowners without financial worries:
Consider meeting with a financial planner to be sure you’re in as good of shape as you think your are:
Do you have sufficient cash for a household emergency?
Are your retirement accounts fully funded?
Are you investing as advantageously as you could be?
Are you saving for your child’s higher education?
Should you consider real estate investments?
Now may be the time to invest, or invest more, in the housing market, but seek advice before buying up tracts of foreclosed upon property; it may be some time before the market rebounds and you can flip the houses.
Consider philanthropic steps that you can take to invest in your community.
Angie’s List members have the following plans for their tax rebates and refunds:
32 percent will pay down bills
25 percent will invest it in home improvement
13 percent will save it for a rainy day
16 percent are unsure or didn’t specify what they’ll do with the money
11 percent will invest in the stock market or other financial sources
2 percent will splurge on something
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- posted on 7/25
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View All Commentsi neeeed a lot of help on how to save!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! i am a single mom and have 2 kids 17&12.....