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Nearly 40% of Americans have less than $500 in cash savings, survey shows
(www.livenowfox.com)
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this post was submitted on 15 Apr 2026
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A Boring Dystopia
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I've never understood why people get so excited about tax refunds, but this provides some context.
Below a certain income, an average lower-middle class family will generally get more back in tax refunds than they pay in income taxes. A family of 4 making 50k per year (fairly livable in much of the country actually!) might only pay in 3-4k in income tax but then receive 6-8k in credits for the child tax credits, earned income credits, etc.
And for a lower-middle class family that tends to be the biggest amount of money they see at any given time. They're only bringing in about $2500/month after taxes, retirement contributions and insurance, and that's got to cover all living expenses. Recieving a nice big check each year tends to be the best way to be able to make a comparably large financial move, often paying down debt that's built up over the year, maybe buying a new car (I know I did that one year, put the entire tax credit into a used car, and that was the very first car we owned outright!) or if it's been a good year that money can be spent on fun stuff
The other side of the coin is that for the overwhelming majority of people who's earnings are coming from their jobs, the amount of money that gets withheld for taxes simply isn't enough to make enough money in interest to be worth while. If you pay $300/month in income taxes (not unrealistic) it would take 4 months before you've got enough to buy the smallest short term CD you can, then that 9 month CD for example will only earn you about $30 before you cash it in in February to pay your taxes. Basically in order for placing your tax money into safe investments to pay enough to be worthwhile, your tax bill would need to be so large that you'd already be paying quarterly anyways and already have much bigger fish to fry than worrying about your tax withholdings not earning you interest.
Tax refunds act as forced savings for many people. It's not a good way to save as the government pays no interest on the savings. The the people then blow the money immediately on major purchases or paying down debt buildup.
Personally, I always tried to make it so that I didn't get a tax return. I always figured it cost me significant money in cash flow through the year. Always pissed me off to overpay in taxes when I could have used the money for critical things I needed during the year.
I can't remember the last time I saw a bank pay interest, either. If you want to grow a principle balance, you need to invest it, and that gets real iffy when the demented gameshow host decides to manipulate the markets.
It seems like my 401k dips $5k every afternoon when Trump promises something insane, then bounces back the next morning when he doesn't follow through.
If you have more than a few thousand in your bank you need to look at their financial offerings or consider opening a high yield savings account at a larger bank. My credit union has a few offerings which give 2-3% interest as long as you maintain a balance over a certain amount (usually 1-5k) but most of the account offerings that are more focused on being fee-free only yield about 0.25% interest. And this is all without dipping into actual brokerage and other more risky financial products
Basically it's the difference between $10k earning you $25 a year or earning you $300-400/year
You can open a brokerage account like Fidelity and put the money in a 3-4% cash account(like spaxx). Takes about 10 minutes and it's low risk. Can get your money any time like a bank.
This is the ideal way to handle your emergency fund, toss it in a high yield savings account with a different bank from your every day one, and then it's harder to tap into if you have a mild inconvenience. Between the high yield savings account and CDs that I keep about 1/3 of my emergency fund tied up in, my emergency fund is earning me about $500/year. Is that a life changing amount of money? Of course not! But it is enough that I can basically never touch my emergency fund and it should hold its value a bit above inflation indefinitely. And as a bonus it's all FDIC insured!
Any halfway decent bank/credit union should be giving a decent interest rate given how high the national rate is.
For example Ally gives 3+% on savings accounts - https://www.ally.com/bank/view-rates/
Not all tax rebates are due to the government over collecting either
I'll be getting about $1600-$2000 just because I Used a certain amount of money towards buying my first home. It's not money that I gave the government ahead of schedule, it's money I wouldn't have gotten unless I did certain things and filed certain paperwork.
Yeah, I knew the republicans were about to fuck over homeowners on the 30% solar tax credit.
Pulled the trigger and now I’m getting back 37k this year and the remainder next… worth it.
The goal otherwise should always be to not owe and not get shit back.