This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Huntington Bank Consumer Tip: Use Tax Refund Wisely

Stocks in this article: HBAN

With federal tax refunds up 3 percent over last year – averaging $3,034 as of the end of February – many taxpayers are getting access to more discretionary dollars as spring arrives.

It can be tempting to use tax refunds for impulse purchases with no long-term impact, like a tropical vacation or a shopping spree. But while it’s natural to set aside a portion of tax refunds for short-term enjoyment, Huntington Bank ( www.huntington.com) suggests five practical uses for your refund that could also improve your overall long-term financial health and well-being.

Save it for a rainy day. Everyone should have a rainy day fund that totals at least three months of his or her yearly salary. If you don't have emergency money set aside, a portion of your refund could go toward a savings account, money market or short-term certificate of deposit.

Save for retirement. Consider putting your refund in a Roth IRA for the 2014 tax year. A 35-year-old who invested $2,500 in a Roth IRA in 2014 and every year thereafter would have access to approximately $210,000 by age 65, if the annual compounded rate of return equaled 6 percent.

Pay off a portion of college debt. According to the Project on Student Debt from the Institute for College Access and Success, seven out of 10 seniors graduated in 2012 with debt, with average debt of $29,400.

Contribute to an education fund. While the College Board reports that tuition in the current academic year of 2013-2014 is rising more slowly than in previous years, the costs of higher education continue to climb. Average in-state tuition now totals $8,900, while average private school tuition tops $30,000.

Make extra mortgage payments. If you use your refund to help pay down your fixed-rate mortgage, you could save thousands of dollars in interest and significantly shorten the term of your loan. Setting aside just $1,200 of your annual refund to pay an extra $100 every month on a 30-year, $100,000 mortgage at a 4.5 percent annual interest rate would result in more than $26,000 in total savings and pay off the loan in less than 22 years. Or, if you have not already taken advantage of historic low interest rates by refinancing your mortgage, your tax refund could help pay for one-time refinancing fees. A refund can also help pay for a down-payment on a mortgage for would-be homebuyers.

About Huntington

Huntington Bancshares Incorporated (NASDAQ:HBAN) is a $59 billion regional bank holding company headquartered in Columbus, Ohio. The Huntington National Bank, founded in 1866, and its affiliates provide full-service commercial, small business, and consumer banking services; mortgage banking services; treasury management and foreign exchange services; equipment leasing; wealth and investment management services; trust services; brokerage services; customized insurance brokerage and service programs; and other financial products and services. The principal markets for these services are Huntington’s six-state retail banking franchise: Ohio, Michigan, Pennsylvania, Indiana, West Virginia, and Kentucky. The primary distribution channels include a banking network of more than 700 traditional branches and convenience branches located in grocery stores and retirement centers, and through an array of alternative distribution channels including internet and mobile banking, telephone banking, and more than 1,500 ATMs. Through automotive dealership relationships within its six-state retail banking franchise area and selected other Midwest and New England states, Huntington also provides commercial banking services to the automotive dealers and retail automobile financing for dealer customers.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs