The retail boom that often follows tax season may be smaller this year, as fewer Americans are planning to spend their returns.
Of the two-thirds of Americans expecting a refund this season, only one in five plans to spend their refunds on everyday expenses, the lowest level ever recorded by the National Retail Federation. The percentage planning to spend their refunds on major purchases such as a television, furniture (8.7 percent) or special treats like a night out (7.6) also fell.
Nearly half (48 percent) of Americans said that they would put their tax refund into a savings account, down slightly from last year’s record high (49.2 percent). More than a third of Americans said they’d use the money to pay down debt.
“Financial security continues to be top-of-mind for all Americans, and consumers are hanging onto their refunds tighter than ever,” NRF CEO Matthew Shay said in a statement.
Among taxpayers who have filed so far this year, about 44 percent have received a refund, worth an average of $2,058, according to the IRS. The IRS issues more than nine out of 10 refunds within three weeks, but some refunds take longer. Taxpayers who file electronically and choose direct deposit will generally get their refunds the fastest.