How Australians Spend Their Tax Returns

Seventy per cent of Australian taxpayers are likely to get a refund this year according to the ATO, which knows a thing or two about these things.

And better yet, the average refund is a handy $3,140; not a bad early Christmas present for people who managed to lodge their return on time.

So what do we spend all this booty on? Well, MoneySmart asked a couple of thousand Australians what they did with their return last year. Here’s what they said.

How we spent our tax returns

  • 31% – Saved it
  • 24% – Paid bills
  • 18% – Loan or credit card payments
  • 11% – Home loan
  • 7% – Holiday
  • 7% – Other things (engagement rings, education, cars, parties)
  • 2% – Household appliances

All in all, it looks like we’re a pretty sensible (boring?) bunch. Very few of us are game to admit that we blew the lot on a new TV or a wild weekend in Vegas.

 

Getting ready to spend? How to score the best deals

 

What we should be spending it on?

For those people lucky enough to be sitting on a glorious little refund right now, here’s what the folks at MoneySmart recommend you do with it.

  1. Pay down debts

Always a great idea. Savings pay 4%, debts cost from 5% – 20%. Do the maths.

  1. Stash it away

Everyone should have an emergency fund in case the worst happens. Otherwise, you could always kick some into your super or stash it away for a home deposit.

  1. Reward yourself

That’s right, even ASIC think we’re being we’re being a little too sensible with these unexpected windfalls. So, let loose a little people, or, in the words of Tom and Donna from Parks and Recreation, “Treat yo self”.

treat yo selfMain image: William Warby, Flickr