Most (if not all) of us should be saving more. We know we need a financial cushion for life’s inevitable emergencies. If we have children, we know we should be saving for their college. And if we plan on retiring someday, we should probably save for that, too.
But you know…saving money is hard. And while it can be tough to save for any one of these things, the idea of saving for ALL of them seems nearly impossible. However, what if saving was made really easy and coincided with something you were doing anyway? Like, say doing your taxes?
Currently, when filing your federal taxes, you have the option to fill out Form 8888, which lets you split your refund into two separate accounts, like say a checking account AND a savings account. It’s an easy way to save part of your refund, but it does takes a little extra effort to request the separate form to do so. But what if this could be made even easier?
What if instead of filling out Form 8888, the actual income tax form had two lines for direct deposit– one for checking and one for savings? No additional paper work, no additional forms, just a space to enter a second account number. You file your taxes and your refund is split automatically, giving you a jump on your savings! Easy peasy.
And making it a reality could be easy as well. One state has already taken the (simple) plunge and added the extra line, and there’s no reason that Arkansas and Mississippi can’t be next. Look for us (and consider joining us in) visiting with Arkansas and Mississippi’s lawmakers in the coming months in support of this little idea that could lead to big savings for families.
Let’s #AddALineForSaving and help families get a jump on their financial future!
This blog is one in a new series from Southern Bancorp Community Partners that examines public policy solutions to increasing economic opportunity, particularly around the areas of savings. It’s part of Southern’s mission to help everyone in rural and financially underserved communities build wealth and increase economic mobility.