Financial Experts Push Tax Season As Prime Time To Start Saving

By Sarah Gantz
The Baltimore Sun

WWR Article Summary (tl;dr) Financial education advocates see tax season as an opportunity to help nonsavers start new saving habits. More than 70 percent of people who file taxes are expected to get money back.

BALTIMORE

April Bradley never imagined she’d be where she is today: picking out paint colors and furniture for a Baltimore rowhouse with her name on the property title.

Six years ago, Bradley was a 27-year-old single mother more concerned about paying the monthly bills and making rent than whether she’d ever own a home, send her son to college or retire.

That changed when she turned to Baltimore CASH Campaign, a financial services nonprofit that Bradley had heard was doing taxes for free. The organization’s volunteers convinced Bradley to use part of her tax refund to buy savings bonds, and she made it a habit.

Financial education advocates see tax season as an opportunity to help nonsavers start new saving habits. More than 70 percent of people who file taxes are expected to get money back. Last year, the average refund was $3,120, but low-income workers who qualify for the Earned Income Tax Credit could receive twice as much. Many people stand to receive a cash windfall, and advocates are encouraging them to invest or save part of their refund.

They say such efforts are especially important in cities like Baltimore, where about a quarter of residents don’t have bank accounts or lack access to full financial services, and instead rely on cash checking services, payday loans and pawnshops.

“When people have this windfall of money, they view it as found money,” said Sara Johnson, the director of the Baltimore CASH Campaign. “Giving them options for what to do with it and encouraging them to save some of it is really important.”

Related News

Leave a Reply

Your email address will not be published. Required fields are marked *