I’ve been preparing my tax returns my entire life. I feel it’s too important to trust some seasonal employee to take care of this chore. Every year as I rifle through the tax tables, I’m struck by how much of my pay goes to support a government that currently seems hellbent on proving it’s broken. Good thing for them the rest of us are working hard and paying their salaries! Tax time is an annual opportunity to reflect on wasteful spending by our elected officials and, as the refunds pour in, by our friends and family, and to unabashedly join them with our own spend fests!
What is it about a sudden infusion of cash that brings out the worst in our fiscal management skills? I am well aware of what I should do with this money; add it to my Roth IRA, pay down my already low debt, use it to make my home more energy efficient…. But the urge to blow it all on a vacation is hard to resist!
While living in Alaska, I was intrigued by the choices the locals made with their double windfall, not only do they receive an Income Tax Refund, but a payout of their Permanent Fund Dividend (Oil company payoffs) every spring. With twice the money, I noticed they made doubly interesting choices. Local businesses advertised heavily that they would be more than willing to help them spend the money on furnishings, computers, vacations, you name it. Alaska has no casinos, so the tribes are missing a huge opportunity there. Most of my Alaskan pals split the payoff into a combination of responsible and fun selections. They paid off debt and went on vacation, or purchased something they otherwise wouldn’t have been able to afford and made home improvements. Split payments, split decisions.
This year, I’m reinvesting my cash in me. I’m putting it towards my career by using it to attend my professional society’s annual educational conference. Every year they pick some ridiculously expensive location to hold our meeting and provide the education we all need to keep our professional skills sharp throughout the coming year. Why they select such an expensive spot every year is a mystery. None of us are making that much, but the folks in charge seem to be pretty seriously deluded. None of us make enough to afford these little jaunts. Fortunately they always hold them in the spring and we can use our tax refunds! Nothing like spending money we don’t have and can’t afford!
My miniscule refund will go towards the hotel costs, easily in the thousands, it’s nearly a week long conference in a major American city during a holiday week (Memorial Day). My company will help with the actual conference costs, but I have to pay them myself first and then get reimbursed, still it’s better than never seeing the money again. I also have to cover airfare. Thank you Southwest!! I would never be able to travel without you! I’m not getting a rental car, the parking charges at the hotel were horrifying! Naw, I’ll just walk or use public transit. Then there are the restaurant costs. Huge. No way around it, I will have to eat. All told, this little junket will run into thousands of dollars, and the refund won’t come anywhere near that. I make sure when I file my W2 that its as close a match as possible to my expected earnings. Silly me, I should max out the refund opportunity and just count on the big check every spring like the rest of the country!
I’m not sure my refund plans are all that responsible, I would probably be better off investing the money in the stock market (I’m trying to be serious here), but at least I will accrue some education and enjoy an opportunity to network with my work pals. As for my Roth IRA, there is always next year! Happy Tax Day!