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College of Human Ecology

Don't be fooled by instant loan refund hype

Thursday, January 25, 2007

MANHATTAN, Kan. - Instant tax-refund loan businesses are becoming increasingly popular. People who want their refund immediately sometimes go to such businesses to get it the quickest way they possibly can.

These so-called instant tax refunds are highly promoted as "quick loans" to get access to taxpayers´ money, said Carol Young, family financial management specialist with Kansas State University Research and Extension. Like all loans, however, they come with a cost.

Getting past the "quick loan" hurdle isn´t the only thing taxpayers should be cautious about during tax season.

"With money in your pocket, you´re tempted to buy all kinds of `fun´ things - maybe things that you don´t really need, but would like to have," Young said. "You need to keep repeating to yourself, `This is not extra money. I have not just won a special prize or the lottery. This is my money that I´ve spent all year earning.´"

Before receiving tax refunds, taxpayers should think about what was on their "need list" prior to tax season: Paying off a credit card bill? Buying new tires or repairing the car? Upgrading their home computer? Saving for a vacation?

All of those needs will still be there, waiting for attention, Young said.

For more information:
K-State Research and Extension - News
Mary Lou Peter-Blecha, coordinator

This article was posted on Thursday, January 25, 2007, and is filed under College News, Family Studies & Human Services.