IRS and Your Tax Rebate

April is barreling down on us and news has broken that "the man" will be issuing out tax rebates to stimulate the economy. In lay-man's terms, the government is giving you back money you already paid them. Doing this jolts the economy because everyone goes off on a mini-spending spree.

It's a sad realization that most people view the rebates as "free money." It's not. You already paid that money to the government...hence the term rebate. Once the IRS cuts the check and returns the money you never should have paid them to begin with, you should consider investing it. Chances are you aren't invested anyway. One of the excuses is probably that you never had extra money to invest. Well, here's your chance to stop the bullshit and finally make a smart financial move.

The greatest discovery in history is compound interest. It's the simple fact that the longer you hold an investment, the faster it will grow into more money. This is why there are dynasties of wealth. This is why families continue to maintain wealth. It's the key difference in "old money" vs "new money."

President G.W. Bush has disclosed his $3 trillion dollar budget for 2009 and it is being evaluated with mixed reviews. He was careful to include plans for securing national safety as well as stimulating the economy, but it is coming with a $400 billion deficit added onto America's already unhealthy financial statement. The signs that the economy is beginning to slow are fairly obvious: unstable stock market, sliding real estate market, fewer jobs, lower pay raises, etc. It looks like times will be a tad tough for at least 2 more years.

So when you get your few hundred bucks from the IRS, will it really be worth the beer and ipods you intend to spend it on? The economy will rise once again...in 4 years your tax rebate could be worth thousands of dollars instead of thousands of calories.