As more and more baby boomers enter retirement age, the question of whether or not to sell their homes and move will become a hot topic. In today’s housing market climate, with low available
Tax Refunds A Fool A Mogul And A Samurai
Today’s tax filing deadline doesn’t pass without standing as the annual reminder to all of Seattle’s taxpayers that time seems to pass ever more quickly—as do the comings and goings of our earnings. The best estimate is that this year 70% of Americans will have overpaid by close to $3,000—making their tax refund checks the only smile-producing part of the annual ritual.
The Motley Fool financial site offered its insight into how most people plan to spend their refunds—but at least one real estate mogul counseled for a definite ultimate destination for those dollars. Seattle real estate could play an important role.
According to the Fool, 38% of respondents will use their refunds to pay off existing debts. Only 11% will direct the cash toward vacations; 5% will splurge on some kind of purchase; an equal number will put the cash toward a major purchase. The largest percentage— 41%— will sock their refund dollars into savings accounts. That’s where the real estate mogul agrees.
The gentleman in question is Sean Conlon, himself a multi-millionaire and host of his own TV show. This time of year, with income tax refund dollars rolling into more than 100 million households, he makes it a point to recall his own point of departure from day work as a janitor into being the owner of his own real estate mortgage company.
He saved. Stuffed every spare dollar into a shoebox until he’d scraped together enough to buy his first house. CNBC quoted Conlon’s dictum last week: “I’m a true believer that you should save every penny…until you buy your first house.” Seattle tax refund checks would more than qualify as major stepping stones toward what Conlon assesses as being “still the fastest path to wealth in this country.”
Another pointed tax refund observation came from a website called Financial Samurai. “Sam” points out that with tax refunds nearing the $3,000 mark, that amounts to nearly 6-7% of typical after-tax income: “a pretty meaningful number.” Since saving (that is, not spending!) $250 a month in that income bracket is difficult for most, the tax refund checks provide a one-shot opportunity to make saving a done deal. The same applies to those in higher brackets. In short, since out of sight is out of mind, Samurai recommends the best course of action for any tax refund check is “to make it disappear.” Into a savings account. Then there’s at least one other relevant tax consideration—one that fattens many a refund check: that whopping mortgage interest tax deduction!
The mogul and the Samurai both have valid points—and Seattle real estate opportunities (there are plenty on hand at the moment) certainly fit into that picture.
As a dedicated real estate broker I have helped over 500 families purchase or sell their home and I am qualified to guide you through buying or selling a home. Buying or selling a home is one of t....
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