Getting the most from your tax refund

  • Published
  • By Airman 1st Class Christine Griffiths
  • 355th Fighter Wing Public Affairs
DAVIS-MONTHAN AIR FORCE BASE, Ariz. --  The Airman Family Readiness Center held a workshop explaining how individuals can get the most out of their tax refund on January 15, 2013.

The class was led by Caroline Ellen, 355th Force Support Squadron AFRC volunteer financial counselor. She explained many different ways Desert Lightning Team members could get the most out of their tax return. She also shared different spending options once individuals receive it.

"Two popular options are to take a vacation or put the refund in the bank," Ellen said.
For those looking for returns toward savings she suggests looking into a money market account.

"You may not be able to withdraw money as often, but you are going to get a higher rate in the long run," Ellen said.

Some individuals may wish to save for college. What often works best for service members saving for is a 529 College Savings Plan. A 529 College Savings Plan is named after Section 529 of the Internal Revenue Code which allows families to set aside money for future use.

"There are 529 plans in every state and Arizona has three different types of 529's," Ellen said. "There's one specifically for an individual in a family that is having a child. They sign up for an American Express credit card and every time they use it, they get two points added into their account. It's run by Fidelity Investments."

For some, they may want to use their refund toward getting a house. Ellen suggest putting extra money in a savings account for a home mortgage. Or, if you're currently paying a mortgage, use some of the refund money you've received to pay it off.

"Use some of that refund to pay down that mortgage," Ellen said. "There is a tax break with the mortgage interest. Think of all the change you'll be getting when you pay all that money you owe on your house."

For any questions about tax returns or just finances in general, call the AFRC at 228-5690.