Budget Travel Strategy: Smart Travel Uses For Your Tax Refund

by Chris Owen on

If a tax refund is headed your way, common recommendations include paying off debt; making a major purchase and paying cash, rather than putting it on a credit card and other assorted common sense moves. Travelers can benefit too by using some of the same thinking about what we spend on airline tickets, cruise fare, gear and more.

“Set aside some money for vacation rather than using your credit card and paying interest long after you have returned,” financial experts suggest at Kiplinger in “Ten Smart Uses for Your Tax Refund.”

Looking beyond financial guru tips that can include beginning or adding to a retirement fund, throwing much of that refund into the never ending bog of student loans, maybe some immediate feel good uses would be appropriate also.

Load up travel cards and accounts
Going to be traveling sometime this year? Load up pre-paid travel cards, perhaps a gift card received as a gift that has a few dollars left but was handy to use at the time. Starbucks cards, gas cards or hotel cards some to mind.

MasterCard’s Travel Money Cards are handy. While you have the cash, avoid worrying about it down the road, in several ways with the MasterCard version or one of a number of other cards.

Registering your pre-paid card protects travel funds in case the card is lost or stolen, with no liability, just like a credit card. Starting with a nice chunk of cash from your tax refund, then add to it between now and travel is a good way to save too.

I do this with a dedicated card that is just for my travel fund and believe me, adding to and carrying my “travel card” is a whole lot more fun than a savings account up front. On the backside, eliminate post-travel blues of a new payment to make on a credit card too.

Known Expense Buys
Thinking ahead here is the key.

If, on your last trek through the mountains, one of the last thoughts was “I’m going to need to replace this old backpack before I go again,” but travel is not happening until the fall, get ahead of the game. Buy it now and buy it wisely. Shop and compare various sources with plenty of time, looking for a sale price on the perfect gear.

That works for just about anything and even small items like socks, shoes or more of the pre-paid cards noted above are fair game also. On cruise vacations some travelers choose to pre-pay shore exploration packages, gratuities or beverage packages that can add up quickly on a cruise ship.

Looking ahead to more efficient travel and making the buy you have been putting off is a good idea too. Time for a new digital camera? Buying before the peak travel months this summer can often find lower prices on models those going on vacation are apt to buy.

Buy Now, Travel Later
Cruise lines – between wave season (the busiest booking time of the year) and summer buying season (when many travelers finally get around to booking) – have some of the best deals around right now.

  • Carnival Cruise Lines Friends And Family event, just extended through the end of the month, offer the best rates we have seen so far this year with maximum upgrades and lower fares. Often, it’s one or the other.
  • Celebrity Cruises 123 Go offer new bookers a choice of a free beverage package, free prepaid gratuities or free onboard credit if booked before April 15.
  • Princess Cruises Spring Into Savings Sale has big savings on Europe cruises and Alaska cruises and up to $100 onboard spending money and up to $500 air savings per person. Seven-day Caribbean sailings and seven-day Alaska Inside Passage sailings are also on sale.

Not just the exclusive domain of cruise vacations, other travel options like hotel packages, resort stays and prepaid expenses at destinations around the world are possible too. In Rome, for example, a taxi ride from the air or cruise port can be arranged and paid for in advance. So can tour packages separate from cruise line offerings or hotel-suggested tours, both of which have some of the cost going right back to the source that suggested it.

Beware Of Bargains
Knowing that a great many Americans get a tax refund in the second quarter of the year, sellers of travel and travel-related services feature package deals with refund-laden travelers in mind.

Many are a great value, bundling airfare with car rental and hotel, cruise or resort packages. Some are scams that lie in wait for us to receive that chunk of cash, so check with your trusted travel source or Better Business Bureau before buying.

Bonus Tip: there really is no “Royal Cruise Line.” That’s an old scam by online thieves to get “just $99” to pay the tax on your otherwise-free ride.

Some taxpayers even make spending their refund on travel an annual event. This video shows a bunch of travelers on their third annual tax refund trip.




[Photo credit – Flickr user robotson]

Tax Refunds spent on travel by many says new poll

by Chris Owen on

As Americans get tax refund checks in the mail averaging $3070, 57 percent are spending it on travel. Top destinations for American travelers are Australia, followed by Italy, Ireland, New Zealand and cruising in the Mediterranean.

“It is clear that when Americans dream about travel, they dream big. Australia continues to be the ultimate dream international destination,” Roger E. Block, the president of Travel Leaders Franchise Group told Reuters

Nearly 1,000 people were questioned in a national poll conducted by Travel Leaders Franchise Group, 87 percent of people questioned in the poll said they have or will take at least one leisure trip this year and 62 percent have already gone on vacation. The top U.S. states to travel to were Florida, California and New York.
tax collection agency.
Nearly 90 percent of people questioned in the poll said they have or will take at least one leisure trip this year and 62 percent have already taken a holiday. The top U.S. states to travel to were Florida, California and New York.

Three quarters said they planned to take a trip within the United States and 41 percent had intentions to go abroad, including Canada, Mexico and/or the Caribbean.

Flickr photo by Dave Dugdale

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Backpackers learn how to steal Australian travel

by Tom Johansmeyer on

It’s really pretty simple. Foreign backpackers go to Australia. For several weeks, they’ll wander the country, get drunk and … I don’t know … go to the opera. When the trip’s over, these visitors file fake income claims, which get them thousands of dollars in tax refunds – despite not having actually worked (and thus not having paid any taxes).

Through word of mouth, and probably a few blog posts, word has spread, and it’s really kicking Aussie authorities in the wallet. And, the government is powerless. By the time they catch up with fraudsters, there usually isn’t much money left. Off course, the amounts are known to be too small for the Australian Tax Office to pursue them overseas.

But, this is illegal. Of the hundreds of thousands of backpackers who visited Australia last year, 44 were prosecuted successfully. Knowing my luck, I would have been one of them.

Spend Your Tax Refund

by Erik Olsen on

If you’re one of the lucky souls to
actually get a tax refund this year, you might be interested in ways you can spend it on travel. That’s what I’d be
doing if I were getting a refund…which sadly I’m not. But if you’re coffers will soon be filled with some disposable
cash then  MSNBC has got a list of things you can do. Of course, spending money on travel is, IMHO, pretty much
the best thing you can do with it. Forget expensive gew gaws, travel is all about experience, it is the spice of life,
and so that’s where a good deal of my income goes. I was actually surprised at the data released by Forbes.com which reports
that the average tax refund this year is likely to be about $2,480. That’s some serious cashola. The folks at MSNBC
recommend you blow it on Europe, in particular Iceland. And to be
honest, that’s one place I’ve never been but would happily go tomorrow. They also give the thumbs up to Bermuda, which
is heating up just about now so you can buy a pair of funny-looking shorts and ride a Vespa around looking tres Euro.