A Strategic Approach to Maximizing Your Tax Refund

Spring is finally in the air, which means tax season is officially upon us. While most Americans begrudge the process, there’s a potential silver lining to this annual chore. Tax season offers a unique opportunity for individuals looking to make significant strides in paying off their credit card debt, or in the spirit of spring cleaning, making costly home renovations they’ve been putting off. 


Instead of viewing your tax refund as a windfall to be spent impulsively, consider harnessing its power for making productive, and lasting, changes to your finances and home…  

image of papers including tax refund

Leveraging Your Tax Refund for Debt Repayment


It’s no secret that U.S. credit card debt is at an all-time high: $1.13 trillion as of the end of 2023, to be exact. Making matters worse, credit card debt carries some of the highest interest rates among consumer debts, often exceeding 20% APR – which can result in substantial charges.  


Often times, minimum payments barely scratch the surface of these balances, leading to prolonged repayment periods and increasing total interest paid over time. This makes it challenging to pay off balances and can trap individuals in a vicious cycle of debt.  

Now for some good news: according to the IRS, this tax season is seeing a 2.1% increase in average refund amounts for qualifying Americans. As of February 16th of this year, the average tax refund is $3,207, which signals a potential boon for individuals who rely on their annual refund to help pay down debt or deal with rising costs.  


So, if you find yourself within this average refund bracket, how can you most productively leverage your refund to pay off your mounting credit card debt? 


  1. Make Lump-Sum Payments: Use your tax refund to make lump-sum payments toward credit card balances. Applying a substantial portion of your refund directly to your outstanding debt can yield immediate and tangible results. 
  2. Prioritize High-Interest Debt: Be sure to channel your refund toward the debts with the highest interest rates first, so you'll minimize interest charges and accelerate your path to financial freedom. 
  3. Consolidate Debt: Consider consolidating multiple credit card balances into a single loan with a lower interest rate. Using your tax refund as a down payment or to pay off a portion of the consolidated loan can also streamline your repayment efforts and potentially save money on interest charges. 

If you’re struggling with credit card debt and need some professional guidance, JG Wentworth’s Debt Relief Program might be able to help.** 

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$10,000 $100,000+

Utilizing Your Tax Refund for Home Improvements 


Monthly mortgage payments aren't the only recurring cost tied to owning a home. Money spent on maintenance, renovations, and repairs – particularly for older houses – can easily cost homeowners thousands of dollars. 


In fact, the average amount Americans spent on home renovations in 2022 was $22,000, according to home improvement website Houzz. That's up from $14,000 in 2018. Among the top 10% of homes that spent the most on renovations last year, the average spend was $140,000 or more. This higher annual spend is a reflection of the higher cost of materials which have risen exponentially over recent years. Big or small, new or old, all homes will eventually require some maintenance and renovations.  


Making matters worse for homeowners, contractors that specialize in home renovations are also charging more because the cost of their employee health insurance, workmen compensation and liability insurance have increased. 


Here's the median amount homeowners spent on renovating specific areas of their home last year, according to Houzz.  


  • Kitchen ($20,000) 
  • Main bathroom ($13,500) 
  • Guest bathroom or living room ($5,000) 
  • Laundry room ($3,000) 
  • Main bedroom ($2,500) 
  • Dining room or home office ($2,000) 
  • Guest bedroom ($1,000) 

Fortunately, JG Wentworth’s Marketplace provides homeowners free quotes from local companies that offer highly competitive pricing.*** By aggregating quality contractors in one efficient place, you can easily compare home improvement costs and make the best financial decisions when it comes to your home projects.  Some of the most common renovations include: 


Bath & Shower 


  • Updating Fixtures 
  • Tile Work 
  • Vanity Sink Replacement 
  • Shower or Tub Upgrades 
  • Lighting & Mirrors 

Window Replacement: 


  • Window Removal 
  • Measurement and Selection 
  • Installation 
  • Trim and Casing 
  • Testing 

Roofing Services: 


  • Roof Inspection and Assessment 
  • Roof Repair 
  • Roof Replacement 
  • Roof Maintenance 

Gutter Guards 

  • Gutter guards enhance the protection of your home by preventing water from backing up and damage roof, siding, foundation, and landscaping. 

Spring is For New Beginnings  

Harnessing the power of your tax refund to pay off credit card debt, or make home improvements, can make this spring a time to thrive. Remember that every dollar applied toward debt reduction empowers you to take control of your financial destiny through this season and beyond. 




Petras, G., “Graphics show how Americans' total credit card debt reached record high.” USA Today. February 7, 2024. 

Picchi, A., “Tax refunds are higher so far this year. Here's the average amount.” CBS News. February 26, 2024. 

Houzz Research. “2023 U.S. Houzz & Home Study: Renovation Trends.” Houzz.com. March 22, 2023. 


* The information is provided for educational and informational purposes only. Such information or materials do not constitute and are not intended to provide legal, accounting, or tax advice and should not be relied on in that respect. We suggest that You consult an attorney, accountant, and/or financial advisor to answer any financial or legal questions 


** Program length varies depending on individual situation. Programs are between 24 and 60 months in length. Clients who are able to stay with the program and get all their debt settled realize approximate savings of 51% before our 25% program fee. This is a Debt resolution program provided by JGW Debt Settlement, LLC (“JGW” of “Us”)). JGW offers this program in the following states: AL, AK, AZ, AR, CA, CO, FL, ID, IN, IA, KY, LA, MD, MA, MI, MS, MO, MT, NE, NM, NV, NY, NC, OK, PA, SD, TN, TX, UT, VA, DC, and WI. If a consumer residing in CT, GA, HI, IL, KS, ME, NH, NJ, OH, RI, SC and VT contacts Us we may connect them with a law firm that provides debt resolution services in their state. JGW is licensed/registered to provide debt resolution services in states where licensing/registration is required. 


Debt resolution program results will vary by individual situation. As such, debt resolution services are not appropriate for everyone. Not all debts are eligible for enrollment. Not all individuals who enroll complete our program for various reasons, including their ability to save sufficient funds. Savings resulting from successful negotiations may result in tax consequences, please consult with a tax professional regarding these consequences. The use of the debt settlement services and the failure to make payments to creditors: (1) Will likely adversely affect your creditworthiness (credit rating/credit score) and make it harder to obtain credit; (2) May result in your being subject to collections or being sued by creditors or debt collectors; and (3) May increase the amount of money you owe due to the accrual of fees and interest by creditors or debt collectors. Failure to pay your monthly bills in a timely manner will result in increased balances and will harm your credit rating. Not all creditors will agree to reduce principal balance, and they may pursue collection, including lawsuits. JGW’s fees are calculated based on a percentage of the debt enrolled in the program. Read and understand the program agreement prior to enrollment. 


JG Wentworth does not pay or assume any debts or provide legal, financial, tax advice, or credit repair services. You should consult with independent professionals for such advice or services. Please consult with a bankruptcy attorney for information on bankruptcy. 


*** JGW Connects, LLC is an independent, advertising-supported comparison site and marketing lead generator and does not play a role in decisioning for any of the third party products advertised on this webpage. JGW Connects, LLC and the JG Wentworth Company family of companies are not affiliated with the companies advertising on this webpage. You are not charged for our services. JGW Connects, LLC may receive a referral fee or other affiliate fee for connecting you with these third-party companies or upon you contracting with a third-party company. We do not make any guarantees that these are the only providers in the marketplace, or that their products or services will meet your needs. The products and services presented to you may or may not be the best, or only options, available. 


JGW Connects does not provide any of the products or services advertised and does not make any decisions regarding your eligibility for those products or services. All decisions regarding approval or denial of a particular product or service are the responsibility of the participating company and will vary based upon your particular financial situation, and criteria determined by the company to whom you are matched. Not all consumers will qualify for the advertised rates and terms.