From Deseret News archives:
Use tax rebate to pay down debt, boost savings
More importantly, have you already spent it?
If you haven't received your check yet, the government says the money is on its way. And, in response to my request, several of you have told me what you plan to do with the money.
Typical of such responses is one from a reader named Kathy.
"My husband and I have worked out a system for any extra money that comes in, including tax refunds and rebates," Kathy wrote in an e-mail. "We put half in short-term savings for vacations, home repairs, etc. The other half can be used to pay off debt or put into long-term savings. This has worked well."
I'm sure it has, Kathy. And it sounds like most Utahns are making similar plans. A Dan Jones & Associates poll for the Deseret News and KSL-TV, released last week, showed that 44 percent of those who will receive a rebate plan to use it to pay bills or debt. Another 25 percent will save it, and 3 percent will invest it. Only 9 percent said they will spend it on "nonessential items."
So now we know what you are planning to do with the money. But what do financial advisers think you should do with it?
Sharla Jessop and James Derrick at Salt Lake-based Smedley Financial Services said people shouldn't worry about being patriotic.
"Treat the rebate as a windfall something that will not be repeated and make the most of it," they wrote. "If you have high-interest debt, paying off your debt should be first on your list. If you're living paycheck to paycheck, this is your opportunity to get ahead by building up a short-term emergency account. In addition, save a portion for the future by funding your Roth IRA.
"Psychologically, it's hard to receive a windfall and not spend it. If you're going to spend a portion, make a plan to split the money in thirds: spend a third, pay off debt with a third and save a third."
Sounds like a good plan. And it was echoed by others, including Alan B. Tingey, principal at Cannon Tingey Investment Advisors in Salt Lake City.
"While the intent of the government is that you spend your rebate on goods or services to provide immediate stimulus to the economy, a citizen should have no hesitation using the money to provide the maximum benefit to himself or his family," Alan wrote in an e-mail. "There is nothing unpatriotic about paying down credit card balances or placing the funds in a savings account.
Recent comments
Using government debt to pay down consumer debt. Priceless!
Government Is Bankrupt | May 4, 2008 at 4:33 a.m.
- Hurricanes snap 14-game skid 5:31 p.m.
- Tar Heels beat Valparaiso, 88-77 5:28 p.m.
- Mountaineers outlast Loyola, Md. 5:27 p.m.
- Wie gets 1st LPGA Tour win 5:25 p.m.
- Surprising wisdom from children 5:13 p.m.
- Favre to Rice helps Vikings win 4:19 p.m.
- Photos: A Royal welcome 3:58 p.m.
- Bengals beat Steelers 3:06 p.m.
- Johnson, Titans beats Bills 41-17 3:05 p.m.
- Bush helps Saints stay unbeaten 3:04 p.m.
- SLC council OKs gay rights policies
361 - BYU happy to escape with victory
224 - TCU creams U.
216 - Editorial: Mormons and gay rights
201 - Will state consider gay rights law?
148 - Letters: Strange breed in Utah
133 - Can BYU root for (ick) Utah Utes?
130 - Utes remain silent about BCS
120 - RSL heads to MLS title game
117 - Celtics crush Jazz
104
Sears is holding a special VIP night Sunday, Nov. 15, in stores and online.
Maybe someone out there can help me understand how raising the state...
to BYU. The talk before the season was that BYU had a shot, if they went...
Who says that third parties don't have a chance. Seems to me that every two...
1. Utah, is that the same red as the 80's, no. 2. BYU has the most fickle...
You guys have been our kids for 4 years and some of you more...what a bunch...
I couldn't agree more the game has been played and the best team on the night...
The funny part about all the BYU fans and the ranking stuff. The only ranking...
Clearly winning capped it, but it was great having Gameday and the Utes in...
Get rid of the incumbents!Get people in office that take their...
Way to go! Knock off the defending champions already twice!
I am a frog fan for forty years but the Utes showed class when a TCU player...

