It’s the silver lining of having to deal with taxes.  After all the math and beating your head against a table trying to figure out why box 8 doesn’t add up right because of box 6, it’s nice to see that chunk of change coming back into your pocket.  The average tax refund in 2011 was $2,913 according to an article in Yahoo Finance.  Another figure the article quotes is that the average American worker spends just shy of $2,000 a year on lunches and coffee.

It begs the question of just what to do with a hefty amount of money.  Does it go towards all those lunch breaks?  Does it go towards paying off the credit card debt built up from holiday shopping?  Is it time to buy that new TV?  57% plan to use it to pay off debts.  There’s another option though.  That amount of a refund is perfect for putting down towards a new vehicle.  It’s sound advice for the weary car buyer out there afraid of their credit score.  Lending is really starting to pick up in the sub-prime market as the economy is starting to turn around.  That’s great news for someone with extra spending cash in their wallet.

A higher down payment can lead to a much better monthly.  The difference between putting $1,000 down on financing a $15,000 car is about $297.46 a month at 10% interest.  If you put down closer to $3,000, that rate goes down to $254.96.  That’s over $50.00 a month and that savings can add up fast.  So before just using that tax refund to head to Starbucks, think hard about how much it might benefit the buying of a new car.