While most of us will do the right things, these otherwise intelligent adults will do this.

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Are you getting a tax refund this year? According to the National Retail Federation, nearly 66 percent of Americans are. That’s too bad.

A tax refund is essentially your money that Uncle Sam has held onto for much of the year — and kept the interest. Ideally, you’ll change your withholding for next year so you keep both your money and any interest you can earn. (Yes, rates are dismal, but anything is better than nothing.)

Still, if you’re getting a refund check from Uncle Sam, the big question is: What will you do with it?

Traditionally, Americans spend their refunds. It’s such a tradition among used-car lots that those auto dealers actually raise prices.

“The price bump in the used vehicle market is created by several factors, but one of them has to do with recently filed consumer tax returns,” says Jonathan Banks, executive analyst for NADA Used Car Guide. “Americans looking to buy their next car now have the needed funds in the form of tax refund checks. Their purchasing actions will continue to drive demand during the remainder of the quarter.”

So here’s my first piece of advice: If you don’t need a used car right now, wait a few months before buying one.

Fortunately, more Americans are doing the right thing with their tax refund; Nothing.

The NRF survey declares, “47 percent of those expecting a refund plan to put the money into savings, the highest percentage in the survey’s history.” That’s probably bad news for the NRF, which represents retailers. However, it’s good news for personal finance counselors like me.

Even NRF’s president and CEO Matthew Shay acknowledges the upside here:

“Americans are thinking of the future, and remaining financially secure is a big part of that. A check from Uncle Sam gives consumers the ability to pay down debt, add a cushion to their savings or splurge on a vacation or big-ticket item.”

When I drilled down on the NRF survey, I found even more encouraging news. It seems younger Americans are behaving better than some of their elders; 53.2 percent of those between the ages of 25 and 34 “plan to tuck away their refunds in savings.” That’s higher than the overall average. Also, 47.6 percent plan to “use their refunds to pay down debt.”

Now for the bad news. Please don’t follow these bad examples; “13 percent say they will splurge on a vacation” and “10.5 percent plan to spend on a major purchase like a television or car.”

I can almost forgive buying a used car with your refund if you really need the transportation for school or work, but a TV set? A vacation? If you’re already in debt, these are the worst decisions you can make. Don’t believe me? Then do this; Make a free call to one of Debt.com’s credit counselors, who will analyze your finances and crunch some hard numbers. Call 1-800-810-0989 now.

Howard Dvorkin is a CPA and chairman of Debt.com, an educational resource for those who want to conquer all forms of debt in their lives.

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About the Author

Howard Dvorkin, CPA

Howard Dvorkin, CPA

I’m a certified public accountant who has authored two books on getting out of debt, Credit Hell and Power Up, and I am one of the personal finance experts for Debt.com. I have focused my professional endeavors in the consumer finance, technology, media and real estate industries creating not only Debt.com, but also Financial Apps and Start Fresh Today, among others. My personal finance advice has been included in countless articles, and has appeared in the New York Times, the Washington Post, Forbes and Entrepreneur as well as virtually every national and local newspaper in the country. Everyone should have a reason for living that’s bigger than themselves, and besides my family, mine is this: Teaching Americans how to live happily within their means. To me, money is not the root of all evil. Poor money management is. Money cannot buy happiness, but going into debt always buys misery. That’s why I launched Debt.com. I’m glad you’re here.

Published by Debt.com, LLC