After two years of paying down debt and skipping family vacations, more Americans plan to cautiously start spending their tax refunds once again suggest findings from the National Retail Federation and BIGresearch. About 44 percent of Americans expecting a refund will pay down debt, fewer than the 48 percent in 2009. However, only 65.5 percent of tax payers are expecting a refund, down from 68.4 percent last year.
 
According to the survey, 12.5 percent of people expecting a refund plan to treat themselves or their families to a major purchase such as a new television, furniture or car, up from 11 percent last year. Others will stash their refund away in savings (40.3%), put it towards everyday expenses (28.8%) or go on vacation (10.0%).
 
“A little bit of ‘free money’ will go a long way for Americans this year,” said Tracy Mullin, President and CEO, NRF. “Retailers planning special promotions over the next few months may find that shoppers are a bit more receptive to opening up their wallets than they have been for the past year.”
 
“After spending the last year paying down debt or building up a nest egg, Americans are relishing the idea of spending their tax returns,” said Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch. “Consumers focused solely on essential purchases during this economic downturn, and many are ready to treat themselves to something nice for a change.”

The pent-up desire to spend, however, does not necessarily signal an end to recessionary caution. According to new findings from Auriemma Consulting Group, Most consumers don't expect improvement in the economy for at least another year and continue to tighten their belts. Eighty-five percent of survey respondents believe that it will take at least one year to begin to see improvement in the economy, with 42% expecting that the recovery is still one to two years away.

"Most of our respondents continue to worry about their own finances and job security," says Nancy Stahl, an editor of the study. "About half of respondents said they are spending less on their credit cards, comparing prices more frequently, buying only things they need, buying fewer luxury items, clipping coupons more frequently, and making fewer large purchases."

According to the NRF survey, 60.6 percent of Americans filed their taxes by the end of February, meaning that many tax returns have already been received or are on the way. An additional 24.4 percent will file in March and 15.0 percent will wait until the last minute and file in April.