3 out of 4 Americans Who Expect a Refund Plan to Spend It

According to a survey commissioned by Lexington Law and conducted by Harris Poll, Americans with poor credit scores are more likely to consider a tax refund as a bonus check

SALT LAKE CITY, UT — April 1, 2015 — One in three Americans who expect a tax refund plan to squander their tax refunds this year, suggests a study sponsored by Lexington Law Firm, the nation’s leading credit repair service provider.

 

shutterstock_107787821-2

 

Harris Poll, on behalf of Lexington Law, surveyed more than 4,000 adults ages 18 and older in February 2015. The survey asked specific questions related to how their tax refunds are being used, their credit score and general knowledge of credit, and how they’ve used their tax refunds in the past.

Results showed that one in three Americans plan to spend their tax refund on non-essential items, such as vacations, entertainment, electronic and mobile devices.

arrow Read this post

Published Study: Americans Tend to Be Spend-Happy with Tax Returns

The following information provides insights into Americans’ attitudes and opinions about tax refunds, credit scores, and financial responsibility. You will find overall key findings followed by the detailed findings per question afterwards.

budget tax

Key Findings

When it comes to their tax refunds, Americans are proving themselves to be spend-happy. Nearly three quarters of those who expect a tax refund this year plan to spend their refund on something (74%). Topping the list are non-essential items (35%) such as vacation (23%), entertainment like going out to movies or dinner (11%) and electronic (9%) and mobile (6%) devices.

Americans also revealed various regrets they had in with regards to spending a tax refund. One in five Americans who have ever received a tax refund admit they have later regretted what they purchased with their refund. One in ten (10%) regretted spending it on a vacation, which is ironically the #1 response for plans to spend this year among those who expect to receive a refund.

Interestingly, Americans who say they have a poor credit score are more likely that those who say they have an excellent credit score to agree that tax refunds are to be used for fun purchases (47% vs. 33%), would rather buy something for myself or a loved one from a tax refund rather than pay off a debt (51% vs. 20%), and to consider a tax refund as a bonus check that should be used to buy themselves something rather pay off a debt (39% vs. 22%). Not surprisingly, those with excellent credit scores are significantly more likely than those that have a poor credit score to agree that people who do not have good credit scores should pay off their debts with their tax refund before buying anything else(92% vs. 73%). Given this, it’s no wonder that roughly a quarter (26%) of those with a poor credit score admit they are not at all/not very financially responsible.

Detailed Findings

1. Which of the following, if any, do you plan to spend your tax refund on? Please select all that apply. 

Nearly seven in ten (69%) Americans expect a tax refund this year. Among them, three quarters (74%) plan to spend their refund on something, while 26% will not spend it on anything. Over one in five (23%) plan to spend it on vacation, 17% on home improvement projects, 14% on clothing. Roughly one in ten will spend it on entertainment such as movies or going out to dinner (11%), a vehicle (11%) electronic device (9%) or a computer (9%). 6% plan to spend it on a mobile device such as a smartphone or tablet, 5% say home appliance and a quarter (26%) plan to spend it on something else.

Interestingly, more than a third (35%) of Americans who expect a tax refund this year have plans to spend it on something non-essential – vacation, entertainment, electronic device or mobile device.

  • Those with good or fair credit scores who expect a tax refund this year are more likely than those with excellent or poor credit scores to spend it on something non-essential (41% and 43% vs. 33% and 32%, respectively).
  • 32% of those with a poor credit score who expect a tax refund this year plan to spend it on something non-essential.
  • Those with excellent or good credit scores who expect a tax refund this year are more likely than those with fair or poor credit scores to spend it on a home improvement project (20% vs. 12% and 14%, respectively).
  • Those with fair (18%) poor (14%) and good (12%) credit scores are more likely than those with excellent (8%) credit scores to spend on entertainment.
  • Those age 18-34 (44%) and 35-44 (38%) who expect a tax refund this year are more likely than those age 45+ (29%) to plan on spending it on something non-essential.
  • Men who expect a tax refund this year are more likely than women to have plans to spend their refund on an electronic device (11% vs. 7%, respectively).

2. Which of the following would you say best describes your current credit score? 

 85% of Americans were able to/chose to describe their credit score. 9% do not know what their current credit score is, 5% claim they don’t have one, while 2% declined to answer.

66% of Americans report they have an excellent/good credit score, with 43% saying excellent and 24% saying good. Roughly one in five (19%) Americans admit they have a fair/poor score, with 12% saying fair and just 7% admitting their credit score is poor.

  • Likelihood of reporting an excellent credit score increases with age [age 18-34 (53%), 35-44 (65%), 45-54 (67%), 55-64 (71%) and 65+ (83%)].
  • Those age 18-34 (12%) are more likely than those age 35+ (8%) to not know their current credit score.

3. Which of the following, if any, have you ever used your tax refund on, which you later regretted? Please select all that apply.

Among all Americans, 18% admit they have later regretted what they purchased. Nearly one in five (18%) admit they have later regretted what they purchased with their tax refund. Roughly one in ten (9%) regretted spending it on a vacation (ironically the #1 response for plans to spend this year among those who expect to receive a refund). 8% have regretted spending it on clothing, while just 1% say each of the following: a wedding, pool/hot tub, an engagement ring, plastic surgery and less than 1% say hair implants. 3% say they regretted spending their refund on something else.

  • Men are more likely than women to have later regretted something they purchased with their tax refund (21% vs. 16%, respectively).
  • Americans age 18-54 are almost twice as likely as their older counterparts age 55+ to have later regretted something they purchased with their tax refund (22% vs. 12%, respectively).
  • Those with an excellent credit score are the least likely to have later regretted something they purchased (79% excellent have not regretted any purchases vs. 69% good credit score, 70% fair credit score and 69% poor credit score).

4. How financially responsible, if at all, do you consider yourself? 

An overwhelming majority of Americans (94%) say they are very/somewhat financially responsible with 55% claiming they are very financially responsible and 39% reporting they are somewhat financially responsible. 6% admit they are not at all/not very financially responsible with 5% saying they are not very financially responsible and 1% reporting they are not at all financially responsible.

  • The likelihood of reporting they are very financially responsible increases with age [age 18-34 (40%), 35-44 (46%), 45-54 (56%), 55-64 (65%) and 65+ (75%)].
  • As expected, those with an excellent credit score are more likely to say they are very financially responsible (78% excellent credit score vs. 45% good credit score, 32% fair credit score and 25% poor credit score).
  • Roughly a quarter (26%) of those with a poor credit score admit they are not at all/not very financially responsible.

 5. How strongly do you agree or disagree with the following statements? 

“Those that do not have good credit scores should pay off their debts with their tax refund before buying anything else.”

  • 87% of Americans agree with this statement, while 13% disagree.
  • Older Americans age 65+ are more likely than their younger counterparts age 18-64 to agree with this statement (91% vs. 86%, respectively).
  • Those with an excellent credit score are more likely to agree with this statement (92% excellent credit score vs. 88% good credit score, 83% fair credit score and 73% poor credit score).
  • Almost three quarters (73%) of those with a poor credit score agree with this statement.

 

“I plan to spend all or some of my tax refund to pay down debt.”

  • 44% of Americans agree with this statement, while 27% disagree and 29% say not applicable.
  • Americans age 18-44 are more likely than those age 45+ to agree with this statement (54% vs. 36%, respectively).
  • Those with a good credit score (55%), fair credit score (60%) and poor credit score (59%) are more likely than those with an excellent credit score (34%) to agree with this statement

 

“Tax refunds are to be used for fun purchases.”

  • 40% of Americans agree with this statement, while 60% disagree.
  • Americans age 18-64 are more likely than those age 65+ to agree with this statement (43% vs. 28%, respectively).
  • Men are more likely than women to agree with this statement (43% vs. 38%, respectively).
  • Those with a good credit score (45%), fair credit score (50%) and poor credit score (47%) are more likely than those with an excellent credit score (33%) to agree with this statement.

 

“I would rather buy something for myself or a loved one from a tax refund than pay off a debt.”

  • 30% of Americans agree with this statement, while 70% disagree.
  • Americans age 18-34 are more likely than those age 35+ to agree with this statement (40% vs.26%, respectively).
  • Men are more likely than women to agree with this statement (32% vs. 28%, respectively).
  • Those with a good credit score (36%), fair credit score (36%) and poor credit score (51%) are more likely than those with an excellent credit score (20%) to agree with this statement.
  • Roughly half (51%) of those with a poor credit score agree with this statement.

 

 “I consider a tax refund as a bonus check that should be used to buy myself something rather than pay off a debt.

  • 30% of Americans agree with this statement, while 70% disagree.
  • Americans age 18-44 are more likely than those age 45+ to agree with this statement (36% vs. 25%, respectively).
  • Men are more likely than women to agree with this statement (33% vs. 27%, respectively).
  • Those with a good credit score (36%), fair credit score (33%) and poor credit score (39%) are more likely than those with an excellent credit score (22%) to agree with this statement.

 

“I rely on my tax refund to pay my bills, so a delay would affect my financial stability.”

  • 23% of Americans agree with this statement, while 57% disagree and20% say not applicable.
  • Americans age 18-44 are nearly twice as likely as those age 45+ to agree with this statement (31% vs. 16%, respectively).
  • Those with a fair credit score (34%) and poor credit score (40%) are more likely than those with an excellent credit score (15%) or good credit score (25%) to agree with this statement.
  • Two in five (40%) of those with a poor credit score agree with this statement.

 

Methodology

This survey was conducted online within the United States from February 3-10, 2015 among 4,031 adults ages 18 and older by Harris Poll on behalf of Lexington Law via its Quick Query omnibus product. Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was used to adjust for respondents’ propensity to be online.

All sample surveys and polls, whether or not they use probability sampling, are subject to multiple sources of error which are most often not possible to quantify or estimate, including sampling error, coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments. Therefore, Harris Poll avoids the words “margin of error” as they are misleading. All that can be calculated are different possible sampling errors with different probabilities for pure, unweighted, random samples with 100% response rates. These are only theoretical because no published polls come close to this ideal.

Respondents for this survey were selected from among those who have agreed to participate in Harris Poll surveys. The data have been weighted to reflect the composition of the adult population. Because the sample is based on those who agreed to participate in the Harris Poll panel, no estimates of theoretical sampling error can be calculated.

About The Harris Poll

Over the last 5 decades, Harris Polls have become media staples. With comprehensive experience and precise technique in public opinion polling, along with a proven track record of uncovering consumers’ motivations and behaviors, The Harris Poll has gained strong brand recognition around the world. The Harris Poll offers a diverse portfolio of proprietary client solutions to transform relevant insights into actionable foresight for a wide range of industries including health care, technology, public affairs, energy, telecommunications, financial services, insurance, media, retail, restaurant, and consumer packaged goods. Contact us for more information.

arrow Read this post

Lexington Law Responds to the Significant Shift in How Credit Reporting Companies Will Operate

The company’s consumer advocate applauds changes concerning medical debt

Salt Lake City, UT – March 16, 2015 – Lexington Law, a consumer advocacy law firm and trusted leader in credit report repair, responds in favor to the agreement announced on Monday by Equifax, Experian and TransUnion, to adopt major changes that aim to improve consumers’ credit scores.

Among other things, the agreement addresses late medical-bill payments and the handling of customer complaints. Under the new agreement, set to take effect within the next several months, the credit reporting agencies have agreed to delay inclusion of any unpaid medical bills in a credit report for six months, giving both consumers and insurance companies more time to take care of payment. Additionally, consumers will no longer have to wait for the medical debt to be removed from their credit report. Credit reporting companies will erase the item after the debt has been paid.

arrow Read this post

Lexington Law Expands Its Successful “Credit in a Minute” Video Series

“Credit in a Minute” video series to help consumers effectively navigate their credit and credit scores.

Lexington Law, the nation’s leading credit repair provider, has expanded its “Credit in a Minute” educational video series for consumers. The series provides quick takes about critical topics, and is hosted by noted consumer advocate. Dr. Randy Padawer, whose groundbreaking work in ethical credit repair has been featured by The Motley Fool, Smart Money Magazine, MainSt.com and other consumer focused organizations. The “Credit in a Minute” video series is featured on Lexington Law’s YouTube channel, Facebook page and on other various Lexington social channels.

arrow Read this post

One in Two Americans Who Plan to Use Credit Cards Are Fearful About Credit Card Security This Holiday Season

New survey by The Harris Poll and Lexington Law reveals that nearly two thirds of consumers plan to use cash for holiday shopping.

Lexington-Law-One-in-Two-Americans-Who-Plan-to-Use-Credit-Cards-Are-Fearful-About-Credit-Card-Security-This-Holiday-Season

Salt Lake City, UT – November 20, 2014

More than half of American consumers are worried about credit card security, suggests a recent Lexington Law survey conducted online on their behalf by Harris Poll.

Lexington Law commissioned Harris Poll to survey more than 2,000 adults age 18 and older and ask specific questions about whether their credit cards have been breached, what types of payment forms they intend to use for holiday shopping, and their feelings regarding credit card security breaches in general.

While some blame credit card companies, most Americans (70 percent) believe that retail chains are at fault for credit card breaches. The survey also revealed that 65 percent of holiday shoppers say they have used or plan to use cash to pay for their purchases compared to 61% who plan to use credit cards this holiday season.

The study, conducted in late October, found that 51 percent of Americans who plan to use a credit card for their holiday shopping are fearful of being affected by security breaches. In addition, for one of every two people, the risk of identity theft due to a credit card breach outweighs the benefits and potential rewards of using a credit card to purchase gifts.

“After so many high-profile security breaches this past year, these kinds of consumer attitudes really aren’t a surprise,” said Randy Padawer, a consumer advocate for Lexington Law, the nation’s leading credit report repair provider. “What is surprising, and perhaps disconcerting for retailers, is just how many consumers say they prefer cash instead.”

Other interesting survey highlights:

arrow Read this post

Published Study: Two-Thirds of Holiday Shoppers Using Cash This Season

Half of Americans believe concerns over credit card fraud or security breaches outweigh the rewards they could receive by using a credit card for holiday shopping.

The following information provides insights into Americans’ attitudes and opinions about credit card breaches and holiday spending.

Key Findings

Two-in-five Americans who have credit cards have had them compromised in at some point; one-in-five have had this happen in a store, one-in-six had this happen online.

Nearly one-quarter of Americans whose credit cards have been compromised say they use them less online because of that; One-in-ten say use credit cards less in-store as a result.

Nearly two-thirds of holiday shoppers will be using/have used cash for holiday spending, however nearly as many will/have used credit cards (six-in-ten holiday shoppers). Half will/have used debit cards and over one-third will/have used online payments for holiday spending.

Half of the holiday shoppers who have/plan to use credit cards confess to being fearful about being affected by credit card security breaches when trying to deck their halls this season.

Over two-thirds of holiday shoppers who have credit cards say something would stand in the way of their using credit cards for shopping this holiday season; a preference for paying with cash or a debit card is most popular (nearly two-thirds say this) however right behind is the risk of identity theft due to a credit card breach, with nearly three-in-ten American credit card holders expressing this. Risking going into do debt and being in too much debt already (either credit card or other types of debt) round out the reasons holiday shoppers who have credit cards might not pull out that plastic this holiday season.

Good news for credit card companies/banks, as a majority of American credit card owners have confidence in these financial institutions when it comes to protecting them from a security breach. A majority of Americans also agree that a security breach could affect their credit score. Seven-in-ten Americans blame credit card breaches on retail chains, while nearly six-in-ten place the fault with credit card companies. Half of Americans feel that concerns over credit card fraud/security breaches outweigh the rewards they could receive by using a credit card for holiday shopping.

arrow Read this post

How I repaired my credit: Lexington Law Scholarship Program

Lexington Law, the trusted leader in helping people repair their credit reports, understands the importance of financial planning and maintaining a great credit score, especially for college students. For this reason, the company is pleased to offer the “Lexington Law Scholarship Award” fund.

Affording college can be a challenge. With the increasing costs of tuition, books, housing, utilities, food, etc., students need all the help they can get. Sometimes that means taking out a loan or using a credit card to cover costs. Taking on debt may be unavoidable to complete an education, but students can learn to avoid harming their credit scores in the process.

Lexington Law is offering this scholarship to students in the United States who write an essay about how they repaired or established their good credit. Lexington Law believes it is never too early to start thinking about your credit score and your credit report.

How to Apply-

Eligible students will:

  • Write an essay of no fewer than 800 words about how you repaired or established your good credit. Competitive candidates will describe and demonstrate knowledge of credit scores and clearly state examples of how they affectively fixed or established their good credit.
  • Research and cite two pieces of content that supports your essay.  An example of a reputable cited page would be here.
  • Publish your essay either in Word format as an attachment to an email to scholarship@lexingtonlaw.com, or anywhere on the Internet, i.e. your personal blog, YouTube, or any other online publishing platform.
  • YouTube submissions are encouraged, although not required.  Video should be no longer than 4 minutes.  (Essays submitted via YouTube must also be submitted in writing.)
  • Email a content contribution agreement, along with your full contact information and the link to access your essay to scholarship@lexingtonlaw.com.

arrow Read this post

Woman to Credit Bureaus: I’m Not Dead!

 Lexington Law Spotlights Corporate Responses to Credit Report Errors

SALT LAKE CITY, UT – (PR Web) August 4, 2014 — Lexington Law, the nation’s leading credit repair provider, responded this week to press reports detailing the experiences of consumers who have been mistakenly listed as deceased within their credit reports.

“One might think that these are just funny stories about problems that are easily corrected,” said Dr. Randy Padawer, a consumer advocate with Lexington Law. “Unfortunately, though, when consumers complain that something reported about them is false, they are almost always disbelieved.

“The implications can impact great numbers of Americans whose real grievances are so often met with raised eyebrows and doubt,” Padawer added.

arrow Read this post

Poll Uncovers Financial Dishonesty in Committed Relationships

A recent Harris poll, sponsored by Lexington Law, reveals significant dishonesty when it comes to financial disclosure within relationships.

SALT LAKE CITY, UT – (PR Web) June 16, 2014 – A recent Lexington Law survey, conducted on their behalf by Harris Poll, has provided some insight into American attitudes toward honesty and disclosure when it comes to sharing financial information with their romantic partners. The study, held in late May, polled over 2,000 American adults, ages 18 and older. Dating, engaged and married Americans answered questions about when to reveal financial information — and even when to lie about it.

arrow Read this post

Published Study: New Harris Poll Reveals American Opinions on Money and Finance in Relationships

The following information provides insights into Americans’ views and personal experience on truthfulness in finances, dating and sharing financial information and other financial related items with regard to romantic partners. You will find overall key findings followed by the detailed findings per question afterwards.

Key Findings 

Survey results show that 29% of Americans say they have ever lied to a romantic partner about their financial situation/would consider lying about it. 71% have never done so/would never consider doing this. Of those who have done so, or would consider doing so, results varied and include saying it wasn’t serious enough of a financial problem to tell (32%) or because the relationship wasn’t that serious (24%).

When it comes to handling financial situations, 70% of Americans say they believe you should always talk to your partner openly about financial issues. However, men are likely to choose money over love as men are more likely than women to believe it’s okay for an individual to date someone for their money (12% vs. 7%, respectively) and actually date someone for their money (13% vs. 8%, respectively).

Roughly a third (36%) of Americans say people should share information about their finances within the first 5 months of dating, while the majority (56%) thinks someone can have debt of up to $5,000 before they should tell their partner.

arrow Read this post