Bear in mind that when you use onetime income to meet recurring expenses, you’re likely headed for trouble down the road. And if you’re splurging out of frustration or some misguided notion that you will help rescue the economy, think again. Spending to feel better is a temporary fix and usually just buries you further and makes you feel all the worse later on. Think about how you spent your refund last year. 

This article from Time is on the right track. Spending your tax refund unwisely could pose problems in the future, but using a tax refund to add to your mortgage principal or add to your savings would be a great deal. Splurging our of frustration – we’ve all been there before. Thinking that it will help rescue the economy maybe not but we have been in the  position to think that if we just buy one more thing it can’t hurt.  Splurging without the finances to back the purchases creates havoc on your budget.

How did I spend my refund last year? Symphony tickets. The year before that I used money to go on a cruise and digital camera

These were things I was planning anyway, so there was no harm in using the money for those purposes. In previous years, I invested some of the money that I received from my tax refund. 

Using a tax refund to buy a used car or to pay your rent or something else might be problematic, because where would you get the money otherwise to make the paying and there is always maintenance and upkeep of certain items that you buy.

There are recommendations to spend the money on classes, paying off a loan, donating money, purchasing something that will save you money in the long run or investing. All good ideas but what is really important and impressive is using money wisely. If you need to use your tax refund to pay off your heating bill from the winter or to reduce your credit card debt then do it.

A tax refund is still your money. Getting a large refund may be considered a bad thing by tax professionals but getting a refund rather than having to pay taxes is better, especially if you don’t want to raid your savings. Also, if you have investments in previous years when you earned more in interest and capital gains your taxes may have been higher.

Even with a tax refund, it is important to spend wisely.

Is your retirement account flatter than a pancake? You are not alone. A recent survey released shows that many people who are looking at retirement have less confidence that they will be able to afford retirement now than two years ago.

Having a secure retirement is what many people desire.

The Employee Benefit Research Institute says that only 13% of workers who feel very confident that they have enough money for a comfortable retirement has dropped to a new low, dropping five points since last year. In 2007, 40% of the respondents stated that they would have enough for a financially secure retirement. The number of respondents who feel somewhat confident has remained about the same at 41% a decrease of two percent since last year.

More older workers are planing to work in retirement. If possible, live well on less. In retirement, it is generally thought that pensioners have lower expenses for living if their house is paid for and don’t have education fees for children and other costs. The rising costs of healthcare and basic expenses looms large in the minds of everyone especially those who are considering retirement because their funds will be less likely to increase as much as someone who could switch jobs or change careers for a greater income. 

The EBRI states that many people do not know how much money they need for retirement. An equal number of people will either sit and plan or guess at how much they need for retirement. More people are paring down their spending and saving, but not necessarily for retirement. Lately there has been an increase in savings, because of the uncertainty in the economy.

Forty-two percent of workers believe that they need $500,000 saved for a comfortable retirement. Having more for retirement is better than having less. Have you calculated how much you think you might need?

As I was going to the grocery store yesterday, I saw a billboard for Feedthepig.org. This one featured a large container that fries come in with rolled up bills in it. Of course this was across the street from a White Castle’s restaurant.

I don’t really spend a lot on fast food. When eating out, I would rather go to a nicer restaurant.

I have seen the ads for the Feed the Pig but I had never visited the site. The site gives some good advice but the pig with the slot in his head creeps me out. Also, if you are just looking around, and not clicking anything, the pig will periodically say “feed me.” Maybe I watch too much SciFi Channel but that has the makings of something freaky.

Benjamin, the pig’s name, wants you to conquer your under-saver. I am not an undersaver, but I know I can always save a little more. Something I have been trying to do lately is save the dollar bills from my wallet. The singles aren’t going toward any specific spending goal, it’s just that I have a zip around wallet and if I have too many singles in it, it makes it difficult to zip. So I take out excess change ($1.26 in coins is a good mix) and singles. Instead, I put the singles into a container and when I know I will need some, I grab a few.

Having singles all in one place also comes in handy, when I don’t want to break a big bill or want a little treat from a place in the neighborhood. This way I am not breaking my budget.

The coins I put into a bank for later use. Since the time I was caught without change and had to run into my dentist’s office to ask for change for a dollar, I have had a few quarters with me to feed the meter just in case I don’t find an unmetered spot.

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Saving for retirement and saving for emergencies are not the same. Since there are many people who are feeling the crunch and want to save money on basics, cutting back on your financial obligation to yourself is not a good thing to do, especially if you are reducing your contributions because of the declining stock market be aware that some companies are cutting their matching contributions for workers so that extra “bonus” money that you put into your 401(k) might not be there anymore.

True the savings rate may be considered by some to be an inadequate measure of how much savings a person has, a retirement account just like a Christmas savings account or a special fund that is going to pay for a specific goal or item, should not be considered the same as regular savings. If you spend the money that is supposed to be for your vacation or your child’s college fund, then you aren’t using the money for its intended purpose. The same is for retirement. So if you seem to be wealthy on paper because of your retirement account but rely heavily on plastic with no other savings in sight, then this could be very problematic if a pressing need arises.

Don’t give up on separate savings. Consider your retirement and goal savings accounts (college, vacation, house down payment, etc.) as separate bills that you have to pay each month. Retirement is a goal with different needs and requirements than saving for Christmas. When saving for Christmas or a short term goal, you aren’t looking for compounding interest to really do that much for you.  Compounding interest and time to let your money grow even in a downward economy will be beneficial when saving for retirement.

When you are in the grocery store, it seems so easy to just grab a packet of seasoning to make anything from gravy, spaghetti sauce or salad dressing. Before you reach for a packet off the shelf, check the back of the package and see what the ingredients are. Many times if you have spices at home you could make the seasoning yourself and adjust the amount of seasoning that you need. If you are only making two chicken breasts but the recipe calls for 2 pounds of chicken, you may use too much seasoning or have a packet left over that you might forget about and not use.

Don’t get me wrong, seasoning packages are actually very good and useful but if you are making less than the recommended amount, are watching your sodium intake or add more pepper or spice to the packaged spice mix anyway, then you may not want to buy something that is not quite right.

Sometimes adding to a prepackaged mix enhances the flavor and saves you time and money. If you want to make your own pizza crust, but want to add some oregano, rosemary, garlic and thyme to the mix then you will have a pizza crust with zest. Baking a cake, adding flavoring or substituting another liquid like coffee or soda for the water, you will get a different and more flavorful cake than if you had just followed the directions on the box.

The difference between prepackaged seasonings and boxed mixes is that for seasonings, this is supposed to make cooking easy and are intended to be the only thing you need to use. For boxed mixes, this is a chance to express your creativity and add more to something that will start out ok but has potential for more.

Do the math, if you already have the spices, don’t buy a package just because it has a fancy name and is already in a foil lined pack.