Wasting Money: 5 Dumb Ways to Spend A Tax Refund

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It’s officially tax season. If you owe the IRS, you probably dread this time of the year. If you are getting a tax refund this post is for you. According to Credit Karma, the average tax refund in 2018 was nearly $2800. That’s a nice chunk of change to be getting back at one time. Make sure that you are doing something smart with your refund like saving or investing.

Unfortunately, everyone doesn’t do that. They don’t think and end up wasting money. In today’s post, I’ll be going over five dumbass ways for you to spend your refund. Please don’t let this be you.

Expensive Shoes & Clothes

I get it, new clothes and shoes are nice. For some, they make them more comfortable. That’s cool if you get your items for s decent price. There is no reason for anyone to be wasting money on expensive shoes and clothes. It’s not smart. For example, say you get a $1200 refund and want to buy some new shoes and you have to make a choice. You can get some Nike Air Max 90’s for $100 or some Balenciaga’s for $975. The smart choice would be to get the Air Maxes. You’d still have $1100 of your refund left after the purchase. If you bought the Balenciaga’s you’d be down to less than $300. There is nothing wrong with buying a couple of items, but there is no need to spend your refund on shoes or clothing that will make you go broke. In this decade, I want people to do better. Not splurging on clothes and shoes is a good way to start.

All for a Down Payment

Using all of your tax refund for a down payment on a new car doesn’t make sense. Cars depreciate in value. Let me repeat that statement. Cars go depreciate in value. Depending on your situation you may not be able to make your monthly payments. You may get behind with your payments. If that happens, the car could eventually get repossessed. If you couldn’t pay your car note in the 1st place, I’m pretty sure you wouldn’t be able to get your car back from the repo man.  In essence, you are just wasting your money. Don’t be that person.

What you can do instead is find a gently used car and use part of your tax refund for the down payment. Used cars are more affordable. It’s a great chance that you’ll be able to afford your car note too. Heck, depending on how much your refund is, you may be able to pay for a used car outright. I’ve had four cars in my life. All of them have been used. I’m all about saving money.

Not Saving

A lot of people don’t have any money saved. Some even struggle with the thought of saving. It’s a foreign concept, but it doesn’t have to be. You can start with $10 or $20 a week. If your tax refund is a decent size of money, you should save a small part of it. You will thank yourself later if you put $200 or $300 away. Unfortunately, emergencies happen in life. It doesn’t have to be anything crazy either. You could get a nail in your tire or your cell phone may break. Having money in an account can help you out during those stressful times.

If you don’t have an account, check on this Capital One 360. I have one of my emergency accounts set up with them. Money is automatically transferred there once a month. When you get your taxes, you can transfer funds from your regular account to it. For more info on Capital One 360, click this link.

Spending it at the Club

A lot of folks like to go out and have a good time, but there is a huge problem if you choose to spend all of your tax refund money at the club. You may be wondering if that’s possible. It is very much so. If a person decides to go to a club and get VIP service with a couple of bottles, that could easily be $1000 or more. Those 4-5 hours of fun isn’t worth spending your whole tax refund on. Save that money for something else. The club can still be fun if you pay the $20 cover. You don’t have to have bottles or VIP to have fun.

There are other ways for you to have fun without wasting money. You can go to a bar or you could have a party at home. Buying a couple of bottles and chilling at home can save you a lot of money. You don’t have to spend your whole tax refund.


The last dumb way to spend your tax refund is to gamble it all away. You may think that you’re going to hit the numbers, but there’s a really good chance that you won’t. The odds of spending your refund on lottery tickets and actually winning a large amount are not good. The same can be said for casinos. In both cases, you probably won’t even break even. There’s nothing wrong with spending a few dollars on lottery tickets here and there, but don’t overdo it. You will be mad at yourself for spending your tax return money.

If you really want your money to grow, your best chance is to save that money or invest some of it in stocks or something. Robinhood is a cool app that allows you to buy and trade stocks. It’s free to use. I’ve been using Robinhood for a few years now to help build my portfolio. I have some stock in several companies. You can do the same thing. Here is my exclusive link for Robinhood. You get free stock when you sign up. You can’t beat that.

You just finished reading about 5 dumb ways to spend a tax refund. This article wasn’t written to degrade anyone. I wrote it to motivate you and give you some ideas of some things that you should not do when it comes to spending your tax money. It’s all about educating each other.

Do you know of any other dumb ways to spend it? Have you made the mistake of blowing a tax refund before?




  1. I never have had a tax refund to blow:) Fact is, I don’t use the government as my savings account. I’d rather pay them under what I owe them and pay the tax later. That way, I can have my money making money…rather than those dumb asses spending it on dumb stuff!

    1. The only reason I’m getting a refund is because of my crazy 2014. I like to typically even out or pay very little back to the government.

  2. Ugh, so true, Jason!!! In my twenties, I remember vividly “planning” for my tax return as to what kind of useless stuff I could spend it on. Of course I didn’t think it was useless at the time, but it was. What a waste!

    1. It is. I made the same mistake when I was younger. You live and you learn.

  3. Here is way #6, spending it all on new kitchen gadgets, tools, pots and pans when you already have so many you have to store them in the garage. Haha! That’s my dumb way of spending a tax refund 🙂

    1. I need to add that one to the post lol.

  4. I agree with you.I really loved gambling but it reached a time where I didnt get that luck.This really led me into deep shit.Thanks for sharing this post!

    1. Gambling can be fun, but not enough fun to waste a refund on.

  5. Have made several mistakes in the past,like not saving some of that money of my tax refund.Thanks for sharing this post because it has brought great impact.Great post!

  6. Haha epic blog post title! I bet it will rank high on Google; I’m sure more people search that than we’d think. This year I’m just hoping that I GET a refund. After paying in a ridiculous amount last year from bad tax planning (on my part), I really hope I did everything I need to so that I DON’T have to pay in.

    1. Thanks. I’m hoping it ranks pretty good as well.

  7. Lol! I’ve seen tax refunds be squandered away on new tv’so every year, groceries, kids birthday parties, purses. I’ve pretty much seen it all!

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