Though seriously, we have been saving money in our short term cash fund to take care of unpaid time off for maternity leave (I get some time, but not enough to take 3 months) and the extra costs of daycare for the first year. My estimates show that in order to keep my short term emergency fund at a level I like to have it at, I need to save an extra $1300 sometime in the next year. So this would certainly do that.

Unless, of course, this is an advance on our 2008 tax “refund” and not a straight out refund. I aim for 0, which would simply mean having the money for a little more time before I have to give it back.

I’m still working on determining the best approach for gifts. Should I use them to actually buy myself a gift or save the money, use it to pay off some debt, etc?

Usually I use monetary gifts to buy something I’ve been wanting but can’t get for myself. It’s a good way to splurge on occasion without blowing my own budget. Of course had I not done that over the years, the money could have gone to savings or something else practical and might have made more of a difference in my life that way. Still every so often a little splurge is nice, and using gift money to do it helps prevent a feeling of deprivation that might lead one to end up using their own earned income for splurges.

With tax refund money of course it is different I think because as you pointed out that really is our own money given back to us as if it were a gift. I think this post is a great reminder to not view that money as “free,” because it really isn’t.

Nobody should concern themselves that they’re hurting the economy by not spending money.