Think of your tax refund as a free loan to government

Are you still reeling because you had to write a big tax check to Uncle Sam? Are you still elated because the government wrote one to you? Believe it or not, in both cases, something went wrong.

It's less of a shock to the system when the IRS is paying you, rather than the other way around, but ideally, you want to get as close to hitting the nail on the head as you can, so very little money changes hands come April 15. Why? Well, I think the downside of owing money to the IRS is pretty self explanatory.

But when it comes to refunds, a lot of people like getting that check in the mail every year. They count on it, and use it to wipe out debt, or buy a big purchase they've been putting off, or – I hope – boost their savings a bit. Financially speaking, though, getting a refund means you've given the IRS an interest-free loan. They've been sitting on your cash, when it could have been in your paycheck each month, keeping you out of debt in the first place, or in your savings or retirement account, earning a return on your investment.