6 Ways To Stretch Your Tax Refund Further When Shopping in an Inflation Economy
Written by
Jordan Rosenfeld
Edited by
Jasmine Browley
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When your total cost at the store, the gas station or even your monthly bills register higher than expected, it’s easy to point to inflation as the problem. People don’t realize that even when inflation starts to “cool” — that is, not increase as quickly — prices that skyrocketed often stay high.
Despite some rate cuts by the Federal Reserve Board (the Fed), inflation is still steadily rising and most people are paying more for goods and services. Additionally, although President Donald Trump’s tariffs imposed on countries with which the U.S. imports in a lot from, namely Mexico, Canada and China, are now paused, that may change. If so, those tariffs may drive prices up for consumers.
For anyone expecting a tax refund this year, here are some ways to stretch that refund further when you’re shopping in this inflated economy or one where the effects of inflation linger even longer.
Buy as Soon As Possible
According to Jeanel Alvarado, founder of Retail Boss, if you’re looking for a way to save on items for your family, make significant purchases before the full effects of the imposed tariffs take place.
She shared that this can include items such as cars, homes, phones, laptops, tablets, smartwatches, video game consoles and e-readers.
Buy Offseason
Alvarado said retailers may adjust their prices based on higher or lower demand to cushion themselves against inflation, ultimately impacting sales volume and altering shopping behaviors.
These might include AI-powered tools for “dynamic pricing” (a pricing strategy that charges customers different prices for the same goods or services) based on fluctuations in market demand.
“This can lead to a significant difference in prices for items currently in demand, so to stretch your dollar further, I recommend buying offseason items,” Alvarado said.
A winter coat is offseason in summer and a swimsuit is offseason in winter. Doing this can help you stretch your budget further.
Shop Secondhand
, shopping secondhand is a great way to stretch your tax refund further in a high-inflation economy.
“You can find great deals in a range of categories like electronics, furniture, home goods, apparel and more, as well as in-person and online resale platforms such as OfferUp and Facebook Marketplace.”
Another bonus to shopping secondhand is that you get more “bang for your buck,” Murphy said. Everyone knows prices are high right now, especially when you consider the low-quality items.
He explained that secondhand platforms offer high-quality items at low prices, reporting that “51% of shoppers think secondhand items are typically better quality than new items sold in stores today.”
Use High-Yield Savings
For financial steps that can stretch your tax refund, you can put your money into a high-yield savings account rather than a standard savings account, according to Melanie Musson, a personal finance expert with Clearsurance.com.
“If your refund sits in a low-interest-bearing savings account, it will lose value as inflation increases costs,” Musson said. “If you opt for a high-yield savings account, your refund will keep up with inflation better.”
Invest Your Refund
If you can manage your budget without needing your tax refund, Musson recommended you put it directly into investments “where it can grow even higher interest than it would in a high-yield savings account.”
Add To Your Earning Potential Through Education
Musson suggested using your tax refund to take a continuing education course.
“If you can get certified in something that will help your career, you have the potential to increase your income and earn far more than the value of your tax refund.”
Inflation can reduce your dollar’s spending power, so you need creative strategies to overcome this problem.
