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" \n If $2,700 suddenly hit your bank account, you&amp;#039;d feel like you pretty much just won the lottery, right? That&amp;#039;s the average refund awarded by the IRS last year (and more than 80 percent of people filing taxes qualified for a refund), so you may experience that &amp;quot;I&amp;#039;m rich!&amp;quot; feeling soon. Quick reality check before you buy tickets to Cabo: Your refund actually isn&amp;#039;t &amp;quot;free money.&amp;quot; It&amp;#039;s your money\u2014you just didn&amp;#039;t see it on your paychecks because the IRS was holding it throughout the year. (The amount they stow is based on the withholdings you selected on your W-4, that tax form you filled out when you started your job.)  If the IRS withheld more than you ended up owing in taxes at the end of the year, you get a refund check. By the way, the government doesn&amp;#039;t pay back interest on money it withholds, so even though it&amp;#039;s great to get a fat refund, you miss out on some hard-earned cash. If your refund is more than $1,000, talk to HR about completing a new W-4, and make sure it&amp;#039;s accurate: Things like having a baby, getting married, and moving all affect your form. Okay, back to the moment your refund arrives. You&amp;#039;re thinking, Yes, splurge time! Right? You&amp;#039;re not totally wrong. When it comes to achieving financial happiness, indulging is a key piece of the puzzle as long as it&amp;#039;s in moderation. Crunch some numbers to figure out what 10 percent of your refund is, and use that money on something fun. [Editor&amp;#039;s note: She&amp;#039;s your fairy cash-mother!] Now repeat after me: &amp;quot;I will not blow through the rest of my refund check.&amp;quot; You have a unique opportunity to create a valuable financial cushion for yourself by putting most of that moolah in an emergency savings account or, as I call it, your Freedom Fund. To create a solid financial foundation, you need to put aside at least six months of living expenses (your monthly take-home pay times six) in case of an emergency. That way if you lose your job, your car breaks down, or--shudder--a natural disaster (think Hurricane Sandy) drives you out of your home, you&amp;#039;ll have the cash to get through it without going into debt. It sounds hokey, but think about how meaningful this money could be. My own Freedom Fund allowed me to take a leave of absence from Harvard Business School (in the heart of the recession!) to start my dream company, LearnVest. Your Freedom Fund could tide you over if you need to exit a bad relationship or leave a job or start yourcompany. Consider this: The average tax refund is more than a month&amp;#039;s worth of income for two-thirds of us. So saving most of it will get you to at least one full month of the recommended six. That&amp;#039;s an awesome start! Life is a wonderful, wacky ride; unexpected things happen to all of us. Think of your refund as a slush fund for getting through whatever crazy stuff comes at you tomorrow, next week, next year, and beyond. If you do, you&amp;#039;ll be ahead of the game. "^^<http://www.w3.org/2001/XMLSchema#string>
<http://www.cosmopolitan.com/career/advice/a4279/tax-return-advice/>