How Should I Use My Tax Refund Towards A New Or Used Car?

It's almost time to receive those long-awaited tax returns and, if you're like the average American, who, according to the IRS, receives about $3,000 back in tax returns, you may be wondering, "What should I do with this large sum of money?"

About a third of Americans use their tax returns towards a new, used, or current vehicle and for good reason. A car is a necessity in most parts of the country. Without one, unless you live in a city, you wouldn't be able to get to your job, school, grocery store, or home without alternate transportation, but cars can be quite expensive. Here are a few ways that you could spend your tax refund money towards a new, used, or current vehicle.

  • As a down payment on a lease or loan

    If you are looking to buy a new or used vehicle, now would be a great time. You could use your $3,000 as a large down payment on a new or used car loan, which will lower your monthly payments and provide you with a better chance to receive a low interest rate, or you could put a larger down payment down on a new car lease, which will also lower your monthly payments.

  • To refinance, refurbish, or pay off your current car

    If you already have a car and aren't looking to add to your fleet, you could do any of the above to better your current vehicle. Have a high interest rate on your loan? Use your tax refund to take a chunk out of your current loan and refinance for a lower interest rate. Is your vehicle looking a little shabby? Use the money to get it fixed, cleaned, or redone. Still have a large car loan? Use your money to either make a few extra payments or pay off some of the balance directly.

There are many ways that you could utilize your tax refund towards your vehicle. To find out more information, feel free to contact our finance department or stop by our Johnson & Sons Co Inc dealership.

; ;