A new survey of more than 2,000 Americans found that most older taxpayers intend to use any refunds to improve their financial health rather than to splurge on some coveted luxury.
The survey, conducted by YouGov on behalf of TaxSlayer, an online tax preparation and software company, found that 53 percent of taxpayers 55 and older intend to use their refunds to pay down debt, such as credit card balances or student loans. Another 36 percent of older taxpayers would deposit any money they get back in their savings accounts, while 7 percent would add it to their retirement savings accounts, such as an IRA or a 401(k) plan.
But a minority would indulge themselves. Seventeen percent of those surveyed said they would use a refund to give themselves a gift, such as personal electronics or jewelry, while 14 percent would spend it on an experience such as a fancy dinner or a vacation.
The survey also found that older taxpayers like to file early. Nearly half (48 percent) say they typically send their returns by the end of February, while another 28 percent file in March. Only 4 percent usually send their returns after the mid-April deadline, which requires filing for an extension and paying at least 90 percent of the taxes owed to avoid penalties, according to the Internal Revenue Service.
When it comes to preparing their returns, 72 percent say they find some part of the process difficult. Twenty-seven percent see gathering all the required documents as the toughest part, while 21 percent find understanding tax laws the biggest challenge. Also difficult for older taxpayers: the stress of not knowing whether their results are correct (7 percent), finding time to prepare their returns (6 percent), using tax forms (5 percent) and doing the math (2 percent).