Between withholding tax changes and tax refunds, a tremendous amount of cash is potentially looking for a home.
Some people will make economists happy and spend any extra cash on something – it doesn’t make much difference what, economists want to see the cash re-circulated as soon and as often as possible.
No doubt, many retailers will welcome any incremental business (or any business at all).
Spending keeps people employed and employed people can buy other things, thus keeping the cash in circulation.
However, some recent reports indicate that a significant number of people may use their tax refund to pay off debts.
Is it your patriotic duty to buy the big-screen TV you’ve had your eye on for months?
There is a compelling case for spending. Retail sales account for a huge percentage of our economy. When people stop spending, the economy suffers.
However, a decade of cheap and easy credit has trashed personal and corporate balance sheets. Families struggle to keep up with bills, even if they are lucky enough to have two incomes.
The best thing you can do for your country is the best thing for you and your family.
Clean up your personal balance sheet by eliminating as much debt as possible, especially high-interest credit card balances and personal loans.
When you take personal responsibility for your finances, you are helping our country get off our credit habit.
Too many Americans are unemployed, losing their home and/or filing personal bankruptcy. Sure, some made bad decisions and are responsible for their mess, but many are victims.
The fewer of our neighbors find themselves in these circumstances, the less we’ll spend as a society to help them.
You can help yourself and the country by working on your personal financial situation and that includes having three to six months of cash on hand in the event you become a victim also.
