According to Edward Jones, the financial services firm, a third will put the money into savings, and just 8% say they will invest it.
The closer people get to retirement, the likelier they are to save the money. Respondents age 55 to 64, who are within 10 years or so of retirement, are likeliest to save their refund, with almost half (43%) saying that’s how they’ll use the money.
Those between the ages 45 of 54 are less likely; just one in four of this age group plans to save. And 12% of the fun-loving 18- to 34-year-old demographic say the refund check will be spent on fun things such as clothes, entertainment and restaurants, compared with 5% of those 65 and older who plan to use the money for fun.
Respondents with the lowest household income (less than $35,000 a year) are the most likely to spend their tax refund on necessary expenses (61%). Just over one-third (37%) of those with the highest household income ($100,000 or more a year) plan to put their tax refund toward necessary expenses.
Those with household incomes between $50,000 and $75,000 are most likely to invest their refunds.
Americans with no children are the most likely (10%) to spend their refund on something “fun,” whereas only 1% of those with children ages 13 to 17 are willing to splurge.
Americans living in the Northeast are the most likely to invest their tax refund (11%). Those in the West are the most likely to simply save their refund (35%).
“As the economy continues its recovery, it’s no surprise many Americans also are focused on their own recovery, paying down debt and improving their current situation.” says Scott Thoma, investment strategist at Edward Jones.